Zinger Key Points
- Grab Holdings and GoTo Group, major food delivery players, reconsider merger amid ongoing losses and intense market competition.
- Talks explore Grab's potential acquisition of GoTo, led by CEO Patrick Walujo, amidst shareholder support and valuation concerns.
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Grab Holdings Limited GRAB and GoTo Group are reportedly revisiting discussions for a merger, seeking to address longstanding losses caused by fierce competition.
The firms, both dominant players in food delivery across a region with over 650 million inhabitants, are exploring several potential scenarios in initial talks, Bloomberg reported, citing people familiar with the matter.
One possible scenario involves Grab, headquartered in Singapore, acquiring GoTo through cash, stock, or a blend of both, with the Indonesian firm showing greater receptivity to a deal under the leadership of CEO Patrick Walujo, who assumed the role last year, the report added.
The discussions have been sporadic, with major shareholders from both companies backing a potential deal and actively facilitating the negotiations, Bloomberg added, citing an anonymous source familiar with the matter.
The discussions might not result in a complete merger or agreement, according to the sources, the report noted.
One option explored involves dividing main markets, with Grab focusing on Singapore and other regions and GoTo retaining control in Indonesia. The Bloomberg report stated that valuation, deal structure, and governance are key concerns for the deal now.
Price Action: GRAB shares are trading higher by 3.01% to $3.42 premarket on the last check Friday.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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