Grab and GoTo face regulatory hurdles in potential $7 billion merger in Southeast Asia

Grab and GoTo are considering a US$7 billion merger to increase their market share in Southeast Asia's ride-hailing and food delivery sectors. However, analysts believe regulatory approval is unlikely due to concerns about monopolistic behavior. Both companies currently dominate the market, controlling over 70% of ride-hailing and 60% of food delivery in the region. Regulatory challenges in Singapore and Indonesia may hinder the deal, as past acquisitions faced scrutiny from competition authorities. Despite their financial improvements, Grab and GoTo have struggled with profitability. The merger could help them achieve economies of scale in a competitive market, but regulatory hurdles remain a significant obstacle.