Uber teams up with SK Telecom
SEOUL (KOREA) – Uber Technologies said on Friday it will make investment of more than $150 million in a joint venture and partnership with South Korea’s SK Telecom Co Ltd. The latter is proposing to split off its mobility business.
This is Uber’s latest attempt for expansion in a market where it experienced tough competition.
The US ride-hailing company currently offers premium taxi-hailing and registered taxi-hailing services in South Korea, a platform which has seen domination by local player Kakao’s mobility unit.
Uber and SK Telecom said in a joint statement that the new joint venture would “create opportunities in the taxi-hailing market in Korea and help explore new areas such as including future mobility services”.
As per the plan, SK Telecom would separate its mobility services including satellite navigation and taxi-hailing to a new company called T Map Mobility, to which Uber would then provide support with a direct investment of $50 million and another $100 million in a joint venture structure, the companies said.
The joint venture is expected to start operating in the first half of 2021, the statement said.
The joint venture would combine T Map Mobility’s “network of drivers and mapping technology with Uber’s ride-hailing technology and global operations expertise,” it added.
A co-branded platform is also likely to get launched, which riders and drivers of T Map Taxi will be encouraged to be part of after the launch. T Map Taxi is SK Telecom’s taxi-hailing platform, which comes second to Kakao in Korea with 750,000 monthly active users.
Uber will own 51% of the joint venture, while T Map Mobility will have the remaining 49%.
SK Telecom said it expected T Map Mobility, valued at about 1 trillion won ($873.3 million), to evolve into a company worth 4.5 trillion won by 2025.