Jakarta (AFP)

Two Indonesian unicorns, Gojek and Tokopedia, announced their merger on Monday to create a new tech giant in the Southeast Asian country where the digital economy is experiencing accelerated growth.

Gojek motorcycle taxi app and e-commerce company Tokopedia join forces to form GoTo Group, which becomes Indonesia's largest tech company.

The companies have not confirmed the current valuation of the new set, but say the companies were previously valued at $ 18 billion in total.

The partners will offer consumers a super-app, the first to combine e-commerce in Indonesia with private driver reservations, meal delivery, and a plethora of services, including financial services.

This transaction represents "the most important combination of activities in Indonesia," and one of the largest transactions in the technology sector in Asia, they said in a statement.

The groups represented a combined gross transaction value (all platform transactions) of $ 22 billion in 2020.

The new group has among its shareholders American heavyweights, Google, Facebook, Paypal, but also Chinese, Tencent or Alibaba, Singaporean, like Temasek, and Japanese with SoftBank.

Andre Soelistyo, CEO of Gojek, becomes CEO of GoTo Group while Patrick Cao of Tokopedia, is appointed President.

“GoTo Group will leverage the enormous potential of Southeast Asia's largest economy with its rapidly growing middle class and a young, tech-savvy population,” the two firms say.

The new group is counting in particular on an expansion of its online financial services to reach "140 million people who have little or no access to the country's financial system".

- Waist race -

The Indonesian start-up Gojek, which started in 2015 as a motorcycle taxi application, quickly transformed into a platform offering an ever wider range of services, including the delivery of meals, packages or groceries.

CB Insights has valued Gojek at around $ 10 billion, which is present in three other countries in the region, Vietnam, Singapore and Thailand.

The Tokopedia group, founded in 2009, is an Indonesian e-commerce platform that has diversified by offering a marketplace, financial and logistics services for businesses.

Considered Indonesia's second unicorn, it was valued at $ 7.2 billion.

Several other technology companies, such as Grab or Sea Group, are in a race for size to consolidate their market share in Indonesia, the fourth most populous country in the world.

The main economy of Southeast Asia appears as a bridgehead to conquer other countries of Southeast Asia.

"The purpose of this merger is also to obtain financing (...) which can come from a new round of funding or from an IPO", notes Nailul Huda of the Institute for the Development of the economy and finance (Indef).

Gojek and Tokopedia "need funding to face competition from Grab and Shopee (Sea Group)," the analyst told AFP.

This merger follows an agreement announced last month by the Singaporean giant VTC Grab, great rival in the Gojek region, for its IPO on Wall Street.

Grab is expected to be valued at nearly $ 40 billion, a record for a "Spac", a new IPO technique increasingly popular with companies.

The Singaporean Sea Group, which went public in 2017, is also expanding rapidly in the Indonesian market with its Shopee e-commerce platform, whose online payment application ShopeePay has become the leader in the country.

The internet economy across all sectors reached $ 44 billion in 2020 in Indonesia, up 11% year on year, according to a recent report from Google, Temasek, Bain & company.

According to this study, the Indonesian digital market will more than double in 2025, to 124 billion dollars.

© 2021 AFP