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Home / Economy / Trade - Service
Grab to report the acquisition of Uber's SEA operations to MoIT
Nguyen Tung 11:40, 2018/03/28
Grab is requested to report to the Ministry of Industry & Trade (MoIT) over its acquisition of Uber`s South-east Asia business before April 3, announced the MoIT.
​The move is aimed to review whether the deal is in conformity with the Competition Law, stated the Vietnam Competition Authority (VCA) of the MoIT. 
 
Grab has acquired Uber's South-east Asia operations.
Grab has acquired Uber's South-east Asia operations.
Substantially, Grab acquisition of Uber is considered an economic concentration, in this case, an acquisition of enterprise in the market as stipulated in section 3 of the Competition Law, according to the VCA. 

Grab on March 26 confirmed that it has acquired Uber's South-east Asia operations for an undisclosed sum, but described as worth "several billion dollars" by Uber CEO Dara Khosrowshahi in an email sent to employees, putting an end to recent speculation about the merger between the two ride-hailing giants.

Uber will take a 27.5% stake in Grab, a figure which Grab described as "reflective of the companies' respective market shares", while Khosrowshahi will join the Grab board, Grab confirmed.

Grab will also inherit 500 Uber employees across the region, according to the email, additionally, "over the coming weeks we will help our customers move to Grab's apps." Khosrowshahi stated he is convinced that "combining forces with Grab is the right thing to do for Uber for the long term."
 
Beyond its car and taxi-hailing services, the company also has a payments platform called GrabPay and recently launched a financial services platform. As part of the merger, Grab will also be acquiring Uber's food-delivery business, UberEats, in Southeast Asia.

This is just the latest international retreat by Uber, which sold off its operations in China in 2016 and in Russia in 2017.

The withdrawals highlight the limits of the company's aggressive efforts to dominate ride-hailing in dozens of countries around the world. "One of the potential dangers of our global strategy is that we take on too many battles across too many fronts and with too many competitors," according to Khosrowshahi's email.

"This transaction now puts us in a position to compete with real focus and weight in the core markets where we operate, while giving us valuable and growing equity stakes in a number of big and important markets where we don't," he said in the message.

Grab and Uber arrived in Vietnam in 2014 and operate both car and motorbike taxi services. The two services have been running on a trial basis since early 2016, but have been caught up in a turf war with traditional taxi drivers.

Vinasun, a local taxi company took Grab to court accusing the firm of violating tax obligations.  Last September, Hanoi Taxi Association said Uber and Grab had been transferring around $150 million overseas every year to evade taxes. Grab denied the accusation.
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