GRAB on Monday announced that it has acquired Uber's South-east Asia operations for an undisclosed sum - putting an end to months of speculation about the merger between the two ridehailing giants.
Uber will take a 27.5 per cent stake in Grab, a figure which Grab described as "reflective of the companies' respective market shares". Uber's chief executive Dara Khosrowshahi will join Grab's board.
With the acquisition, Grab will take over Uber's operations and assets in eight countries in the region, namely Cambodia, Indonesia, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam.
Grab president Ming Maa told Reuters on Monday that the deal was closed and the firm was in touch with regulators to address any concerns.
He added that the deal was "a very independent decision by both companies" and was "highly" supported by their common investor, Japan's SoftBank Group.
Grab on Monday said it will also take over the operations of Uber's food delivery business, Uber Eats. Grab will expand its existing GrabFood businesses in Indonesia and Thailand to two more countries - Singapore and Malaysia - following the integration of the Uber Eats business.
Grab said that GrabFood will be available across all major South-east Asian countries in the first half of 2018.
"To minimise disruption, Grab and Uber are working together to promptly migrate Uber drivers and riders, Uber Eats customers, merchant partners and delivery partners to the Grab platform."
The Uber app will continue to operate for two weeks to "ensure stability" for Uber drivers, who can sign up online to drive with Grab. Uber Eats will run until the end of May, after which Uber delivery and restaurant partners will move onto the GrabFood platform.
Grab chief Anthony Tan said: "Today's acquisition marks the beginning of a new era. The combined business is the leader in platform and cost efficiency in the region. Together with Uber, we are now in an even better position to fulfil our promise to outserve our customers."
Uber chief Mr Khosrowshahi added: "This deal is a testament to Uber's exceptional growth across South-east Asia over the last five years. It will help us double down on our plans for growth as we invest heavily in our products and technology to create the best customer experience on the planet."
Expectations of such a deal ratcheted up after Japanese financial giant Softbank, which is already a key investor in Grab, became Uber's biggest shareholder with a 15 per cent stake. SoftBank, which has also taken major stakes in China's Didi Chuxing and India's Ola, has been pushing for consolidation in the global ride-hailing industry, which has been bleeding billions of dollars a year due to turf wars.
Uber lost US$4.5 billion last year and has burned through US$10.7 billion since its founding nine years ago. Analysts say by that by exiting the tough South-east Asian,Uber could narrow its losses and better position itself for a 2019 initial public offering in the US.
Grab, which started out as a taxi-hailing app in Kuala Lumpur in 2012, has become the region's dominant ride-hailing service with US$4 billion raised from investors.