Uber is ramping up its investments in India after divesting its Southeast Asia unit to rival Grab, Chief Operating Officer Barney Harford said earlier this week. What's still believed to be the world's most valuable startup has no plans to exit India despite the fact that it's far from profitability in the South Asian country as the Grab deal "freed up resources" for continued aggressive investments in the region, the official revealed. The divestment that's formally packaged as a merger wasn't unexpected even as Chief Executive Officer Dara Khosrowshahi suggested it won't happen shortly before it did given how Uber and Grab now share a major investor in SoftBank who wants to see its portfolio companies start making money in the near future instead of running one another to the ground with endless price wars.
India amounts to more than ten-percent of Uber's global business and the company holds over a third of the local market, according to recent estimates from Counterpoint Research. Uber is now even better positioned to compete in the country following the Grab deal that left it with a 27.5-percent stake in one of its largest rivals in India and will now see it directly compete only with Ola. The tie-up itself has yet to be approved but is widely expected to pass all applicable regulatory checks without major issues. Over the course of the last two years, Uber also staged high-profile exits from China and Russia, with both moves leaving it with significant stakes in former rivals Didi Chuxing and Yandex, thus being conceptually similar to the Grab consolidation.
Profitability still isn't a concern for the company, according to Mr. Khosrowshahi's recent statements and his insistence that Uber could already make money if it wanted to, though not all investors agree with that strategy given how the startup has been burning through billions of dollars for years now. That state of affairs is likely what's driving Uber to pursue an IPO in 2019 so as to allow early investors to cash out and move its financial burden to the public markets.