Sime Darby gets into startup game as investor into Socar Mobility Malaysia’s US$55mil Series B funding
By Digital News Asia September 17, 2021
- Further expansion in SEA targeted following covenant-based investment
- Tech enhancements & increase safety measures that will improve profitability
SOCAR Mobility Malaysia (SOCAR) has closed a covenant-based investment round of up to US$55 million (RM221 million) in its recent Series B funding exercise. Covenants are promises or agreements entered into by a borrowing party to comply with the terms agreed upon in relation to a loan agreement.
SOCAR - currently valued at US$213 million (RM885.7 million), will see both equity and capital injection from South-Korea based EastBridge Partners as well as an investment by Malaysian multinational Sime Darby Bhd in this funding exercise. This investment - the first for both entities into SOCAR Malaysia, takes SOCAR’s financing tally to-date to US$73 million and serves to facilitate SOCAR’s expansion of its multiflex mobility footprint in Southeast Asia.
[RM1 = US$0.241]
“We warmly welcome our new partners – EastBridge Partners and Sime Darby onboard SOCAR’s journey of growth, as we expand to bring multiflex mobility to more countries in Southeast Asia. For us at SOCAR, the fact that we were able to have new equity partners join our growth journey during a global pandemic speaks of the confidence our partners have in SOCAR’s leadership in the car-sharing space and our ability to scale TREVO’s peer-to-peer business across the region. We are pleased to strengthen our relationship with Sime Darby, following existing collaborations with its Motors division, by expanding our strategic partnership into one based on equity interest,” said Leon Foong (pic), CEO of SOCAR Mobility Malaysia.
“SOCAR is excited to welcome these new partners to our capitalisation table. We will utilise these funds to supercharge our vision of multiflex mobility and bring the convenience of car-sharing to more people across Southeast Asia. As countries move into new phases of post-Covid recovery, we are committed to using our TREVO platform to create more economic opportunities for car owners while leveraging the supply of vehicles on our platform to remind consumers what it’s like to be free to travel again in the comfort of their own private space, in a vehicle of their choice,” he added.
The US$55 million investment will be channelled towards continuous technological enhancements and investing in further trust and safety measures that will help improve the overall profitability of the business. SOCAR will also be looking at using its fleet expertise to introduce clean mobility to the masses and will be leveraging its peer-to-peer marketplace expertise to further empower fleet and private car communities across Southeast Asia via its TREVO platform. The investment will be structured into two tranches, with 60% upfront and the additional 40% disbursed based on agreed conditions.
EastBridge Partners’ investment into SOCAR Mobility Malaysia aligns with its Korea+ core investment strategy that leverages EastBridge’s Korea and Pan-Asia network, whereby investments are focused on companies with strong fundamentals, high growth potential and global expansion prospects.
“SOCAR’s business model is fundamentally built around matching motorists to vehicles of their choice, thus improved platform efficiency driven by better accuracy in matching drivers and cars will generate additional revenue and savings that we can reinvest into making the car-sharing community safer and more reliable. Once we achieve our targeted liquidity level for the platform, we can then work with partners to offer users other ancillary services that car owners and drivers need such as insurance coverage. When access to a car becomes as easy as tapping a button on your mobile phone, SOCAR’s position in the transportation ecosystem can transform the way people think about budgeting for mobility,” Foong elaborated.
SOCAR was first launched in Malaysia in January 2018 as a joint venture between SK Inc. and Socar Inc. In February 2020, SOCAR completed its Series A funding of US$18 million with investment from Eugene Private Equity Co Ltd and KH Energy Co Ltd. TREVO, a wholly-owned subsidiary of SOCAR was launched at the end of February 2020, as an app-based P2P car-sharing marketplace.
SOCAR is heralding a new era of multiflex mobility with over 2,200 cars in 36 different models in over 1,000 locations in Selangor, Kuala Lumpur, Penang, Johor, Ipoh and Melaka offered on its app. TREVO currently has close to 6,400 car listings in major cities on its app-based P2P car-sharing marketplace in Malaysia and Indonesia.
Recently, TREVO teamed up with Sime Darby Auto Selection (SDAS), a multi-brand used car dealer under Sime Darby Motors, for the ‘Fund Your Drive’ programme, which introduces a first-of-its-kind concept in Malaysia that allows buyers to retain greater value in their vehicles purchased from SDAS by guaranteeing resale price to SDAS within 12 months through a BuyBack option, while generating guaranteed income on TREVO to finance car ownership.