The acquisition is expected to be completed by the end of the first quarter of fiscal year 2019.

Red Planet Japan will acquire six hotel-owning companies in Thailand from its parent company for a total acquisition consideration of 6,585,130,000 yen. The acquisition includes five operating hotels, located in Surawong (Bangkok), Patong (Phuket), Asoke (Bangkok), Pattaya, and Hat Yai, and a sixth property under development in Sukhumvit Soi 8 (Bangkok).

The operating hotels being acquired in Thailand recorded sales equating to 692,960,064 Japanese yen in 2017 and 787,122,058 Japanese yen in 2018.

As a result of this acquisition, its portfolio will increase to a total of 15 hotels in Japan, Thailand, and the Philippines, including five hotels under development.

Red Planet Japan’s Chief Executive Officer, Tim Hansing said, “We are delighted to announce the significant expansion of Red Planet Japan’s hotel portfolio across Asia. Bilateral tourism is showing sustained growth, particularly among millennial customers who are Red Planet’s core customer base,” said “This acquisition allows us to spread our geographical coverage and, in particular, penetrate key source markets for inbound visitation to Japan.”

With the expansion of low-cost carrier routes, the liberalisation of visa requirements, and a growing affinity for Japanese culture, there has been a substantial increase in the number of tourists travelling from Southeast Asia to Japan in recent years, especially from Thailand. Thai visitors to Japan have more than doubled over the last five years to 1.13 million in 2018. Correspondingly, the number of Japanese visitors to Thailand continues to rise, exceeding 1.4 million visitors in 2016, 1.5 million in 2017, and 1.6 million in 2018.

The acquisition of Red Planet’s Thailand hotels follows a series of expansion announcements by Red Planet Japan, including the planned opening of Red Planet Hiroshima Nagarekawa in the summer of 2020 and acquisition of two flagship properties in Manila in June 2018. Further, the fast-growing brand opened Red Planet Sapporo Susukino South, its fifth hotel in Japan, in June 2018, and expects to open its second property in Sapporo, Red Planet Sapporo Susukino Central, in October 2019.

Simon Gerovich, Chairman of Red Planet Japan, added, “Red Planet Japan is now a regional leader in the Asian budget hotel space with properties in Japan, the Philippines, and Thailand. Not only does this expanded network drive revenues and profit margins due to the economies of scale, but also underlines our regional operational expertise. As witnessed by our recently-announced joint venture which enables us to invest up to 22 billion yen in six new hotels over the next two years, we have the scale to attract new growth drivers such as franchising, management contracts, and joint ventures in both existing and new markets.”

Tos Chirathivat, chief executive of Central Group, said that the retail giant is acquiring a significant stake in Grab Thailand with the investment of US$200 million (Bt6 billion). The company sees the stake purchase as helping to drive the growth of tourism in the country and better integrate the retail and services industries, Tos said.

“Grab is a fast growing online-to-offline (O2O) platform, which has scaled up impressively in Southeast Asia. We look forward to collaborating together to deliver more value to Central and Grab customers, partners and merchants,” Tos said.

Anthony Tan, chief executive and co-founder of Grab, said that Bangkok was the third big city that Singapore-based Grab had expanded into, after Kuala Lumpur and Manila, in the region. The special partnership with Central Group will accelerate Thailand’s development into a digital economy, as promoted under the government-sponsored Thailand 4.0 plan, Tan said.

He said the firm’s services in Thailand range from ride-hailing and food to parcel and grocery deliveries, creating opportunities for hundreds of thousands of micro-entrepreneurs.

The company’s services have also brought income opportunities for merchants and its driver-partners, Tos said.

“For the collaboration, we can help their customers and merchants move from offline to online via our platform. It can enhance the experience for Central’s merchants, customers and tourist visitors,” said Tan.

Yol Phokasub, president of Central Group, said that the Bt6 billion investment in Grab comes under its investment budget of Bt50 billion for this year. The group is focused on becoming digital lifestyle platform in Thailand.

The collaboration will allow all food shops in Central department stores to provide delivery services via the Grab application. At a later stage, the company will provide e-wallet and cash-on-delivery services for customers.

Yol said that the tie-up with Grab formed part of the group’s efforts to increase revenue growth by 12-15 per cent from 2018 to 2022.

Grab Thailand plans to provide e-payment and other financial services, such as micro-finance, to support the needs of its drivers. Its ride-hailing platform covers 18 cities in 16 provinces.

The firm will expand its service to cover five more provinces by the end of this year. The firm last year provided 100,000 trips per day and delivered 3 million meals. Grab Food’s business expanded by 40 times.

The landmark partnership will help move Thailand towards the ‘New Experience Economy’, benefiting consumers and individual service providers, the company said in the release.

Central Group is Thailand’s largest omnichannel retail conglomerate and Grab Holdings (Grab), is Southeast Asia’s leading online-to-offline mobile platform.

Central Group Executive Chairman and CEO, Tos Chirathivat commented, “We are pleased to announce our strategic partnership with Grab Holdings Inc, by investing US$200 million in Grab and acquiring a significant non-controlling stake in Grab Thailand.

“Grab is a fast growing online-to-offline (O2O) platform which has scaled up impressively in Southeast Asia. Grab, like Central Group, is now an essential part of everyday life for many Thai people. We look forward to collaborating together to revolutionise the retail and service industry, a strategic key driver for the country’s growing economic success.

“As part of the agreement, the companies will collaborate across the areas of transport, food & grocery delivery, logistics and more, to deliver more value to Central and Grab’s customers, partners, merchants and tenants.”

Grab Group CEO and co-founder, Anthony Tan said: “This investment brings together Central, the local retail champion, and Grab, the local technology champion, in a deep partnership that reflects our commitment to Thailand and all Thai people as we strive to create jobs and economic prosperity through our platform.

“Central, who has the largest footprint of malls, hotels and merchants in Thailand, will help accelerate our growth across multiple verticals, such as food delivery, parcel delivery and ride-hailing, cementing our position as Thailand’s Everyday App. By joining hands with leading local companies, we can go much further in driving Southeast Asia forward.”

Central Group President, Yol Phokasub said: “This alliance will help enlarge Central Group Economy. Central is focused on becoming the leading digital-lifestyle platform in Thailand, part of our New Central, New Economy vision.

“We will continue stepping up our digital push by partnering with a number of leaders in this space. This partnership with Grab is a pivotal next step to achieve our key goal of omnichannel customer-centric platform covering all lifestyle needs of omnipresent customers. We will work together to create the unique ‘Central-Experience’ by fully leveraging our rich network and strengths.”

Initial areas of collaboration include but are not limited to:

● Food delivery: Bringing on board Central Group restaurants and food-related brands to GrabFood. This will help to expand the reach of these outlets and at the same time offer Grab customers an even greater variety of food, snacks, and beverage options.

● Logistics: Providing on-demand and express delivery services for Central Group businesses and partners through the GrabExpress service.

● Transport: Providing customers, visitors and tourists to and from Central Group malls, stores and hotels easy access to Grab services with special privileges.

Grab Thailand Country Head, Tarin Thaniyavarn said: “Grab’s tremendous growth in Thailand has only been made possible through the strong support of our driver partners, passengers and local partners. We’re humbled and excited to expand our partnership ecosystem in Thailand to have Central Group as a strategic partner.

“We are confident that this puts us in an unrivalled position to grow and scale across the country. The ultimate goal is to deliver more value to the everyday lives of all Thais, whether through convenient access to transport and food, or by helping more Thais earn a better living through the income opportunities of the Grab platform. I am confident that together, we can help boost the Thai economy.”

Grab crossed its three billion rides milestone this month, after hitting its two billion mark just six months ago. The Grab app has been downloaded on over 130 million mobile devices, giving passengers access to over 8.5 million drivers, merchants and agents.

Grab offers the widest range of on-demand transport services in the region, in addition to food and package delivery services.