Grab to buy Singapore's third-largest taxi company Trans-Cab for around $100 million

SINGAPORE - Ride-hailing giant Grab is acquiring Trans-Cab, Singapore’s third-largest taxi operator.

The purchase – for an undisclosed amount but understood to be around $100 million – includes some 2,200 taxis and more than 300 private-hire vehicles which Trans-Cab owns.

Sources told The Straits Times that negotiations started only two months ago, and the transaction is slated to be completed this week. The deal will have to be approved by the authorities.

If concluded, Trans-Cab will be the first Singapore taxi company to be acquired by United States-listed Grab, which has been trying to buy a cab operator for several years now.

In 2017, Grab was in talks to buy SMRT’s fleet, but the deal fell through. In 2022, it started talks with Prime Taxi, the smallest cab operator here, but the deal did not proceed. In both cases, sources said the offers were “too small”.

Trans-Cab entered the taxi market 20 years ago when the Government liberalised the industry to increase competition. Within 10 years, it grew to become the second-largest taxi firm here, overtaking SMRT Taxis, which is owned by the rail operator.

But earlier in 2023, SMRT Taxis – which has since been rebranded as Strides – bought Premier Taxis, and their combined fleet of about 2,500 vehicles now exceed Trans-Cab’s. ComfortDelGro remains Singapore’s largest taxi operator with around 8,800 taxis, or just over 60 per cent of the market.

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Both Grab and Trans-Cab declined to comment on the deal when contacted on Thursday.

The ride-hailing firm, which is in other businesses such as food delivery, finance, insurance and payments, has been incurring losses since it was started in 2012. But an insider recently claimed that its private-hire vehicle business was profitable.

In June, Grab retrenched more than 1,000 employees, its highest number of layoffs. The figure represents 11 per cent of its workforce, and follows a 2020 round that affected some 5 per cent of staff.

Grab’s co-founder, Ms Tan Hooi Ling, will also step down by year-end. The company’s stock last traded at US$3.51, down from a high of more than US$16 in late 2021.

According to latest available statements posted by the Accounting and Corporate Regulatory Authority, Trans-Cab Holdings had a total equity of $62.7 million as at end-2020. In 2021, it reported a net profit of around $8.7 million and revenue of $81.1 million. It had cash and equivalents of $7.6 million as at end-2021.

Observers said Trans-Cab’s exit marks another blow to the taxi industry, which has been buckling since private-hire operators were allowed to enter the point-to-point transport sector in 2013.

This article was first published in The Straits Times. Permission required for reproduction.