Alibaba in talks to pour $3b into Grab, sources say

The Jack Ma-founded company will act as the sole investor in the round and is expected to purchase some of the Grab stock held by Uber, one of the sources said. The potential transaction would represent one of Alibaba’s biggest investments in the region, following its US$1 billion bet in ecommerce major Lazada in 2016.

If such a deal materializes, the new capital would come in at a time when the startup is preparing for “a potentially long winter” amid the Covid-19 pandemic, which Grab CEO and founder Anthony Tan previously called “the single biggest crisis to affect Grab.”

The development comes as Grab and regional rival Gojek have reportedly revived talks on a possible merger agreement on the back of endorsements from shareholders, including SoftBank.

Read: Why a merger between Grab and Gojek makes sense

With Covid-19 still limiting people’s movements, shares of both Grab and Gojek have been selling at major discounts, the Financial Times earlier reported. A merger agreement “could significantly accelerate both Grab and Gojek’s paths to profitability,” said Asad Hussain, an analyst at PitchBook.

However, Indonesia – being the biggest market for the two startups – remains a vital part of a potential deal, with both Grab and Gojek wanting a bigger slice of the country’s ride-hailing market.