Japan’s MUFG to invest over $700m into Grab, source says

Leading Japanese bank Mitsubishi UFJ Financial Group (MUFG) is set to pour more than US$700 million in Singapore-based tech unicorn Grab as part of a strategic collaboration, Bloomberg reported, citing a person familiar with the development.

With its investment, the bank plans to make a range of financial services, including insurance policies and loans, available to Grab users, the source said.

Mitsubishi UFJ Lease and Finance, a subsidiary of MUFG, is also an investor in Grab’s Indonesian rival Gojek.

Photo credit: Grab

The two companies are expected to announce the partnership soon, according to an earlier Nikkei report that cited people briefed on the matter.

A spokesperson for Grab, however, told Tech in Asia that the company does not comment on market rumors and speculation.

MUFG’s investment in Grab will reportedly come after a productive 2019 for the ride-hailing giant in terms of raising capital.

In March last year, the startup raised nearly US$1.5 billion from SoftBank’s US$100 billion Vision Fund to bankroll its super app ambitions in Southeast Asia.

It also received multiple other commitments for its ongoing series H round, including US$1 billion from Toyota, US$250 million from Hyundai Motor and Kia Motors, US$200 million from Booking.com, and US$50 million from Thailand’s Kasikornbank. Other investors such as Experian, OppenheimerFunds, Goldman Sachs, and Citi Ventures also pitched in.

Grab has also been focused on extending its reach and expanding its services toward the end of last year and through early 2020.

In August 2019, the company announced its plans to invest US$500 million in Vietnam over the next five years to tap into the country’s fintech, mobility solutions, and logistics opportunities. It’s also planning to launch new services and expand its transport, food, and payments network there.

In addition, Grab has set aside US$150 million for AI research as it ramps up expansion into food delivery, digital payments, and digital content.

More recently, the company launched a six-month pilot of its on-demand motorcycle service in the Klang Valley in Malaysia. And last week, South Korean automaker Hyundai and Grab officially introduced GrabCar Elektrik, Grab’s electric vehicle service, in Jakarta after a pilot late last year.