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Uber-Foodpanda Deal a Key Overhang for Grab's Share Price
1015 GMT - Uber's plan to acquire Delivery Hero is a key overhang for Grab's share price, DBS Group Research's Sachin Mittal writes in a note. The deal would bring Foodpanda's Southeast Asian operations under Uber's umbrella, in conflict with its noncompete agreement with Grab. Uber would need to fully divest of its 13.5% stake in Grab, which "makes little strategic sense" given Foodpanda's much smaller regional footprint and likely lower strategic value, Mittal says. He notes that the deal might not secure regulatory approval if Uber doesn't sell its Grab stake. Conversely, an Uber threat to Grab could become real if it does divest, Mittal adds. DBS retains a buy rating on Grab but cuts its target price to $5.00 from $5.93. ADRs last ended at $2.91.
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