Sources say that Grab is exploring financial services business spin-off
Grab, a ride-hailing company based in Singapore has mandated several companies to contact prospective buyers to hold minority shares in their financial services business as they look to spin off the unit, according to two individuals who are acquainted with the issue.
Grab has embraced an aggressive approach to extend its variety of services from transportation to meal distribution and payments as it fights Go-Jek of Indonesia to become an app for everything in Southeast Asia, home to some 650 million individuals.
One of the sources said banks and insurance firms are among the prospective buyers in the financial services business of Grab, adding that the scheme is in an early phase.
The source, who refused to be named as not being allowed to talk to the press, said Grab was searching through its spin-off to raise less than US$ 500 million.
“It’s more about getting strategic investors than merely raising funds the source said. “Grab is still eager to maintain control of the department,” said the Financial Times on Wednesday. “Grab is contemplating spinning off its payments and financial services businesses.
A Grab spokeswoman refused to comment on the spin-off opportunities but said the firm has always assessed its business investment structure
The new step occurs just months after the company, the most funded start-up in Southeast Asia, announced it had taken in a year-long funding session in the region’s most significant personal financing round in more than US$ 4.5 billion.
Grab, supported by SoftBank, said it was trying to raise another $2 billion this year last month.
Grab is pressing deeper into customer credit and expanding loans to small companies as part of its extensive development into the financial services industry, a region that it has set aside for development.
Both Grab and Go-Jek began as a ride-hailing service and accumulated millions of customers in low-income nations with cut-rate prices quickly.