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Grab (GRAB.US) acquires Singapore's Chope to increase food delivery services amid intensifying competition

AInvestTuesday, Jul 23, 2024 5:10 am ET
1min read

Grab Holdings (GRAB.US), a ride-hailing and food delivery service provider, has acquired Singapore restaurant reservation app Chope for an undisclosed sum, expanding its services as competition for users intensifies.

Grab and Chope spokesmen confirmed the acquisition.

Grab is looking to fend off rivals such as GoTo Group and Line Man Wongnai in markets including Singapore, Indonesia and Thailand, and is pushing beyond its core ride-hailing and food delivery services to boost its share in the competitive Southeast Asian market of more than 650m people.

The acquisition will add dinner reservations to Grab’s portfolio, with Chope’s reservation app popular in the region but also facing fierce competition in crowded markets.

“Given the challenging and competitive market we are in today, we have chosen to look for a partner to seek new sustainable growth opportunities,” Arrif Ziaudeen, Chope’s founder, said in a statement. “We evaluated potential buyers and found the company that best fits Grab.”

As part of the acquisition, Grab said it would take over Chope’s operations in Singapore, Indonesia and Thailand. In an internal email cited by Reuters, Grab’s delivery division head Ngiam Xin Wei said Chope employees would join Grab in a few weeks. Grab said the acquisition would not result in layoffs, and Chope’s team would continue as a department under Grab’s omnichannel ecommerce business.

In a report, Bloomberg Intelligence analyst Nissim Naidu said Chope was close to profitability and the acquisition would not affect Grab’s positive adjustment to its earnings before interest, tax, depreciation and amortisation (EBITDA). He said Chope’s 1,000 merchants would support GrabFood’s ecosystem of more than 200,000 merchants and promote outdoor dining advertising sales.

The latest acquisition underscores Grab’s dominance in the ride-hailing and food delivery sectors in the region. Grab and GoTo in Indonesia also restarted discussions on a merger of their core businesses earlier this year, according to Bloomberg.

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