After months of speculation about a possible partnership — and in light of Singapore’s cab population dropping to an eight-year low and the recently confirmed Grab-SMRT partnership — ComfortDelGro announced on Friday its plan to acquire a majority 51 percent stake in Uber’s Lion City Holdings car rental business in Singapore. Uber will retain the remaining 49 percent.
Lion City Holdings operates Lion City Rentals, which has a fleet of about 14,000 vehicles, The Straits Times noted. As for ComfortDelGro, it had about 14,306 cabs under its Comfort and CityCab brands at last count in October.
ComfortDelGro’s biggest deal to date, which is subject to regulatory appeal, is valued at about S$642 million, with a cash consideration of S$295 million. If it comes through, it will “create a path” for ComfortDelGro’s cabbies to have customers sent their way from the Uber app.
Under this joint venture, the taxis and private-hire cars under both companies will fall under a centralized fleet management system, which will dispatch vehicles for bookings.
“By working together, we will be able to benefit from each other’s strengths. Uber will benefit from our fleet maintenance and management capabilities, while we will benefit from Uber’s world-class technology,” ComfortDelGro’s chief executive Yang Ban Seng explained in a joint media release from both companies.
Calling it a “win-win situation”, Yang said that customers would have more choices with taxis or private-hire vehicles, as well as shorter waiting times and greater reliability.
“The two companies are finalising additional partnership opportunities and will make further announcements in the upcoming months,” the statement added.
According to TODAY, Grab responded to the deal by saying that ComfortDelGro and Uber were “trying to play catch up to regain their market share”. It added that Grab and its taxi partners had so far “out-innovated” the other two, and were currently in a “strong position” to grow their fleets.
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