26 January 2022 (closed)
Jakarta Composite Index (6,600.82) +32.65 +0.50%
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Possibly the biggest story in local Indonesian media over the past couple of days (if we exclude coverage of any COVID-19-related matters) is the news that Gojek is in talks (in fact in the final stages, reportedly) to merge with Tokopedia. Based on the input of people familiar with the matter, the two companies have agreed to conduct due diligence on their respective businesses.
Aplikasi Karya Anak Bangsa (better known as Gojek) is the hugely popular on-demand, multi-services platform, and digital payment technology group which, for now, is Indonesia’s only homegrown Decacorn (referring to a tech startup company that is valued above USD $10 billion).
Meanwhile, Tokopedia is a hugely popular e-commerce platform (one of the homegrown tech startups that achieved the unicorn status; referring to a valuation above USD $1 billion).
The merger between Gojek and Tokopedia would be huge as both startups facilitate money flows that equal around one percent of Indonesia’s gross domestic product (GDP), each. So, if achieved, the new organization (after the merger) would account for (at least) two percent of Indonesian GDP. Few companies can make that claim.
This update consists of 18 pages. It discusses:
- Possible reasons why both sides may want to merge
- Whether strong competitors (Grab and Shopee) are 'forcing' this merger
- Plans to conduct an IPO in Indonesia and the United States
- Whether rivalry between existing investors in both startups (such as Alibaba and JD.com) can cause problems
- Overviews of Gojek and Tokopedia
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