Indonesian ride-hailing company Grab wants to overtake its rival Gojek, and has some mergers planned to do so, according to Reuters.
The SoftBank-backed company is reportedly looking to merge Indonesian FinTech OVO — in which it owns shares — with Ant-backed DANA. It would buy a majority interest in DANA and then merge it with OVO.
The move would help OVO-DANA to overtake Gojek in the country’s digital payments ecosphere. OVO and Gojek have been neck and neck in terms of the top of the payment pyramid, and DANA has been trailing closely behind.
Grab is worth about $14 billion and Gojeck is worth about $10 billion. In addition to ride-hailing, they both offer eCommerce, financial and delivery services. OVO’s latest valuation put it in the neighborhood of $2.9 billion. DANA’s valuation is not known.
The move illustrates how successful the online payments industry is in Indonesia, with a growing eCommerce market and 260 million potential customers.
Before the deal can move forward, it needs to be worked out with the country’s central bank, because of certain ownership restrictions involving foreigners.
SoftBank reportedly is in favor of the merger.
Ant Financial has voiced some opposition to the deal because of differences in valuations, and it reportedly wants to be the one that’s taking the lead in expanding digital payments in the region.
In Indonesia, the potential market for payments looks healthy, because over 50 percent of citizens don’t have bank accounts, but they do regularly use smartphones to make transactions.
Other payment firms have taken notice. Facebook’s WhatsApp has been speaking with multiple payment firms in the country about being able to offer its services in Indonesia.
OVO, which is owned by Lippo, an Indonesian conglomerate, is the official payment partner of Grab. Gojek has backing from the likes of Google and Visa. DANA was originally created to be embedded in the Blackberry Messenger chat app a few years ago.