Uber-ComfortDelGro deal under review by Competition Commission

Photo: Bloomberg

The Competition Commission of Singapore (CCS) is reviewing the proposed merger between land transportation services corporation ComfortDelGro and Uber Technologies subsidiary Lion City Holdings would see a diminishment in the taxi services sector.

On December 8, the SGX-listed land tranport services corporation entered into a deal to acquire a 51 per cent stake in Lion City Holdings for about S$295 million ($218 million). Lion City Holdings is the operator of Lion City Rentals (LCR), which owns a fleet estimated at 14,000 vehicles.

It is seeking public feedback on the impact of the deal and is conducting a public consultation from 21 December to 8 January 2018 as part of the review. Given the highly competitive nature of the city-state’s car rental market.

The joint venture (JV) will aid the firms to leverage each other’s operational and technological excellence and create a path for ComfortDelGro’s taxi drivers to receive ride requests on the Uber driver app, thereby increasing their potential earnings. It also increases the transport options of the taxi services.

There are a large number of companies of different sizes and business models operating in Singapore, and the commission seeks to assess if the ComfortDelGro-Lion City Holdings partnership will prevent, restrict or distort the competition in Singapore and result in abuse of their dominant position.

If approved, the deal will see Uber’s mobile app and ComfortDelGro taxi’s smartphone mobile application integrated to form uberFLASH, in a move that would permit consumers to book ComfortDelGro taxis via the Uber app.

The proposed collaboration between ComfortDelGro, Lion City and Uber, covers booking services for meter-fared taxi services, with meter fares continued to be set by ComfortDelGro but does not overlap with ComfortDelGro’s street-hail business. Additionally, it will combine the fleet resources of both ComfortDelGro and Uber to “efficiently and effectively” cater to consumers in Singapore.

Singapore’s taxi services market is dominated by an oligopoly that involves transport network connectors Uber and Grab and incumbents like ComfortDelGro and SMRT. Earlier this year, Grab was reported to be in discussions with SMRT regarding the acquisition of its taxi business.

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.