Negotiations with Grab fell to a standstill, Gojek is about to merge with Tokopedia?

According to Bloomberg, ride-hailing and payments giant Gojek is in the process of discussing a merger with local e-commerce firm Tokopedia. This is said to be a prerequisite move to prepare for the company’s IPO right after the merger.

Specifically, the two most valuable Indonesian startups signed detailed terms for evaluating each other’s business activities. Both sides have seen potential support between the two sides and are close to finalizing the deal as soon as possible in the next few months.

The merger will create an Indonesian internet giant with a market value of around $ 18 billion. Their businesses range from ride hailing, payment to delivery, and online shopping.

In fact, Gojek and Tokopedia have considered merger potential since 2018 but discussions have accelerated after talks between Gojek and Grab came to a standstill. The reason for this is attributed to Grab CEO Anthony Tan, who continued to refuse Masayoshi Son’s suggestion to relinquish control of the company after the merger with Gojek.

It is known that during the discussion Grab made a request that founder Anthony Tan will be the “lifetime CEO” of the company after the merger with Gojek. Other conditions are given such as “who is appointed and what is the conditions as well as the new CEO of the group in the event of Mr. Tan’s death”.

Previously, Grab and Gojek – the two most valuable startups in Southeast Asia with a total value of about $ 25 billion discussed the possibility of a merger after years of fierce competition in the ride-hailing, food delivery and financial technology. As recently as December, the two companies said the negotiation process had progressed significantly. However, the problem still lies in the provisions related to Indoneisa – an important market in the region.

The fastest growing Internet economies in Southeast Asia.

Masayoshi Son – who once strongly supported Grab CEO is said to be currently impatient with his resistance to ceding control of the company following the merger with Gojek and he moved to support a merger between Gojek and Tokopedia – also is a company that Softbank invests in. These two companies share many other investors, including Google, Temasek and Sequoia.

The two companies are valued at $ 10.5 billion and $ 7.5 billion, respectively, and they are currently discussing a merger rate. The founders of the two companies have been friends for more than 10 years and they form a solid alliance. Meanwhile, Grab and Gojek got into a lot of controversy and they couldn’t come to the conclusion of the terms.

The combination of Gojek and Tokopedia will become the dominant unit in Indonesia – one of the fastest growing Internet economies in the world. Their IPO plan will give global investors an alternative to Sea – the only Southeast Asian company listed on the US stock exchange to see its share price rise 400% last year.

The agreement between Gojek and Tokopedia, if it happens, will also be subject to less scrutiny from the government than combining with Grab.

Currently, companies are contemplating various listing options. They can choose to go public in Indonesia and the US or through a specialized acquisition company (SPAC) to list in the US.

Tokopedia said last month that it hired Morgan Stanley and Citigroup as advisors for the IPO plan. “We have yet to decide what market to list in and by what method. All options are still under consideration. A plan through an acquisition is the most potential option, but everything remains.” has not been finalized at this time “, a representative of Tokopedia said.