Tech giant Microsoft said late Monday that it will invest an undisclosed sum into Singapore-based ride-hailing company Grab, as part of a strategic partnership.
The two companies will also collaborate on technology projects in areas such as big data and artificial intelligence, while Grab will now use a number of Microsoft products, including the Azure cloud computing service, according to a joint statement.
"We're fascinated with the companies that are emerging from Southeast Asia," Peggy Johnson, executive vice president at Microsoft, told CNBC in an interview. "It's been amazing to watch what they have done with technology, in the way that they've applied it to solving problems for their customers."
Microsoft and Grab declined to disclose the amount of the strategic investment.
So far this year, Grab has already raised $2 billion from Toyota and institutional investors. It had raised about $6 billion in total funds as of Aug. 2, 2018, and is valued at $11 billion, according to CB Insights.
On Friday, Reuters reported that Japan's SoftBank was closing in on a deal to invest about $500 million in Grab as part of the ride-hailing company's latest funding round that is likely to be completed in a few weeks.
Grab President Ming Maa declined to comment on ongoing investment discussions, but he told CNBC that the company was on track to raise about $3 billion in funds by the end of the year. He also declined to give an estimate of how big the investment from Microsoft is, compared with the funds raised from other backers throughout the year.
"We cannot comment on sizing but I think what's probably more important for us is not the sizing, but the quality of the partners," Maa said, explaining that Microsoft can help the 6-year-old start-up "scale beyond where we currently are today."
Grab is already backed by a number of prominent companies, including SoftBank, Toyota and Chinese ride-hailing company Didi Chuxing.
The company operates in eight countries around Southeast Asia. It offers ride-hailing, food delivery, mobile payments and financial services. Earlier this year, Grab bought Uber's regional business and consequently faced regulatory scrutiny in several markets.
Maa explained that Grab will use the investment from Microsoft to improve user safety and experience.
As part of the deal, the Southeast Asian company said it will work with the tech giant to develop new ways of verifying passengers and drivers using facial recognition technology with built-in artificial intelligence that could potentially improve safety and security for users.
Grab plans to use Microsoft's data analytics, fraud detection, machine learning and computer vision technologies and services to personalize the user experience. Passengers will also be able to book rides directly through the Microsoft Outlook application, the companies said.
"Where Microsoft fits into this is all of the AI/machine learning platforms that Microsoft has developed will allow us to build these services," he said.
Microsoft considers artificial intelligence to be one of its top priorities and says it wants to make it accessible to everyone. Earlier this year, it showed at its big conference for developers what it will be like to live in a world infused with AI. The company is hiring engineers to work on AI chip design for its Azure cloud division and, in recent months, snapped up two artificial intelligence start-ups: Bonsai and Lobe.
Johnson told CNBC that investing in AI will remain a focus for the company going forward.
"One of the things that we look for are tools that make AI easier so that customers like Grab, who we work with, can implement AI without having to have a team of data scientists," she said, adding, "We look for tools in that area and we'll continue to focus on it."
Clarification: This story has been updated to remove information from another media organization that it has since withdrawn.