Indonesia’s GoTo denies merger talks with ride-hailing rival Grab

Technology

A Gojek driver looks at a smartphone in Jakarta, Indonesia, on Monday, Dec. 11, 2023. ByteDance Ltd.’s TikTok agreed to invest $1.5 billion in a joint venture with Indonesia’s GoTo Group that it will control, part of a pact that lets the Chinese company restart its shopping app in its biggest online-retail market. Photographer: Dimas Ardian/Bloomberg via Getty Images
Dimas Ardian | Bloomberg | Getty Images

Indonesian tech giant GoTo on Tuesday denied it is in merger discussions with Singapore-based ride-hailing rival Grab.

“The company would also like to emphasize that currently, the company is not having any discussion on such matters,” said GoTo in a Tuesday filing.

The comment comes after Bloomberg reported Friday that the two companies have restarted talks for a potential merger as they look to stem losses arising from intense competition with each other.

“The company would like to emphasize that the company has an increasingly strong fundamentals and financial position,” said GoTo. The firm added that it has achieved “positive adjusted EBITDA target in Q4 2023, while exceeding the top end of its full year adjusted EBITDA guidance range.”

EBITDA refers to earnings before interest, taxes, depreciation and amortization, which is an alternate measure of profitability to net income.

The company is set to release its fourth-quarter and full-year 2023 results in March.

Grab closed 1.2% lower on the Nasdaq on Tuesday amid a broader sell-off in U.S. markets. Indonesian markets are closed Wednesday as millions cast their ballots.

GoTo Group was formed in May 2021 in a blockbuster merger between two of Indonesia’s largest start-ups: Gojek and Tokopedia.

On Dec. 11, GoTo and TikTok announced that Tokopedia and TikTok Shop Indonesia’s will be combined into an enlarged Tokopedia entity, in which TikTok will take a controlling stake of 75.01%. Over time, TikTok will pump $1.5 billion into the entity. GoTo on Jan. 31 said Tokopedia has finalized the transaction with TikTok, ByteDance’s short video platform.

The deal came after Indonesia in September banned e-commerce transactions on social media platforms such as TikTok Shop and Facebook, in a blow to TikTok’s e-commerce ambitions in the region.

Articles You May Like

GPs warn of ‘considerable backlog’ after IT outage and say ‘normal service’ will take time
Israel confirms deaths of two hostages in Gaza
Court opens case into LaLiga boss over CVC deal
Elon delays Optimus, Hyundai gets nervous, and a REAL work truck
Tesla increases Model S and Model X prices