ComfortDelGro left in limbo as Uber falls to Grab

The proposed $642m acquisition of LCR might be renegotiated.

As Grab assumes control over Uber’s Southeast Asian operations, ComfortDelGro is left in limbo amidst its proposed tie-up with the defeated ride-sharing giant.

On December, CD announced it was cooperating with Uber for a proposed acquisition of 51% of the Lion City Rental for $642m. This move launched the UberFlash service which matched riders with the nearest CD/UberX vehicle.

However, with Grab’s acquisition of Uber’s ride-sharing business, the terms and conditions of the deal could be renegotiated so that CD can continue to partner LCR with Grab, according to CIMB.

Also read: Higher fares and reduced subsidies loom as Grab nabs Uber's operations

“We believe this the more positive move for CD as it helps them to ringfence their interests, enables them to enter the private-hire space and have both interests aligned; especially if the purchase price for LCR could be negotiated lower,” said CIMB analyst Cezzane See.

However, CD could also opt not to pursue its partnership with LCR and the taxi segment could remain in limbo which could have possible negative effects to the competition.

The CD/Uber deal also entered into second phase of review last February as the Competition Commission was unable to conclusively determine if the deal violates competition rules. This could then set the precedent in terms of timeline for the review and sanctioning of the Grab/Uber merger.

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