Gojek, Tokopedia to merge in Indonesia’s biggest ever deal at US$18 billion
- Gojek’s Andre Soelistyo will lead combined business as CEO, with Tokopedia’s Patrick Cao serving as group president
- Gojek shahreholders to hold 58 per cent of combined entity called GoTo; Alibaba and SoftBank to be major shareholders of GoTo
Tokopedia and Gojek, two of Indonesia’s biggest technology companies, said on Monday that they planned to merge to create a digital leviathan spanning e-commerce, ride-hailing and financial services based in the world‘s fourth most populous country.
Gojek’s Andre Soelistyo will lead the combined business as GoTo’s CEO, with Tokopedia’s Patrick Cao named GoTo’s president.
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Kevin Aluwi will continue as CEO of Gojek and William Tanuwijaya will remain CEO of Tokopedia. In addition to his group responsibility, Soelistyo will continue to lead payments and financial services, under the new brand of GoTo Financial, which encompasses GoPay as well as the group’s merchant and financial services offerings.
Gojek and Tokopedia have been in merger talks for months after plans for Gojek’s combination with Singapore-headquartered ride-hailing app Grab collapsed, people familiar with both sets of negotiations have said.
GoTo would have handled more than 1.8 billion transactions with a total gross transaction value of more than US$22 billion last year. The newly formed group had a registered driver fleet of over two million and over 11 million merchant partners as of December. It also claims to have over 100 million monthly active users.
GoTo will also further develop its payments and financial services offerings to provide an enhanced financial experience to consumers, drivers and merchants while also expanding to reach more underserved segments in Indonesia, where 140 million people have little or no access to the country’s financial system.
Gojek and Tokopedia were both founded over a decade ago and have unlocked the benefits of the digital economy for millions of people across Indonesia and Southeast Asia - including consumers, service providers and merchants of all sizes. Despite their scale, both companies remain unprofitable.
The two companies first worked together in 2015 to accelerate e-commerce deliveries using Gojek’s local network of drivers. The companies will continue to thrive and coexist as stand-alone brands within the strengthened ecosystem.
“Gojek drivers will deliver even more Tokopedia packages, merchant partners of all sizes will benefit from strengthened business solutions and we will use our combined scale to increase financial inclusion in an emerging region with untapped growth potential,” Soelistyo said in a statement unveiling the merger.
GoTo aims to list in both Jakarta and New York in the future. It is likely to make its public markets debut later this year on at least one exchange, one of the people familiar said.
Gojek and Tokopedia have amassed a combined US$8.1 billion from investors across multiple rounds of fundraising, according to Crunchbase. They have at least three investors in common: Sequoia, Google and Temasek.
After the merger, GoTo’s major investors will include Alibaba and SoftBank Vision Fund 1, according to a person familiar with the matter. Alibaba owns the South China Morning Post.
“With the acceleration of digitisation in Southeast Asia, we see tremendous opportunities in this region,” said Michael Yao, Tokopedia board member and Alibaba senior vice-president.