Go-jek in talks to buy pay­ments gate­way Mid­trans

Mint Asia ST - - News Dealstreetasia - BAY ASTHA M AHESHWARI


big­gest uni­corn Go-jek con­tin­ues to be on the prowl for strate­gic ac­qui­si­tions. The ride-hail­ing com­pany is un­der­stood to be in talks to make a strate­gic in­vest­ment in pay­ments gate­way start-up Mid­trans, ac­cord­ing to three peo­ple aware of the de­vel­op­ment.

Re­spond­ing to a query, an e-mail from Go-jek said, “We can­not give you any com­ment at the mo­ment. We will get back to you when we have an up­date.” An email query to Mid­trans re­mained unan­swered as of press time.

In­dus­try ob­servers es­ti­mated the value of the deal at over $100 mil­lion.

Set up in 2012, Mid­trans, for­merly known as Ver­i­trans, is a pay­ment gate­way for credit cards. It aims to pro­vide on­line businesses in In­done­sia with a pay­ment in­fra­struc­ture that is safe, re­li­able, and fraud-free. Cus­tomers in­clude Mata­hari Mall, Toko­pe­dia, Bukala­pak, Cot­tonink, Bro.do, Garuda In­done­sia, Pegipegi and Jd.id.

Ac­cord­ing to re­search re­ports, the In­done­sian mo­bile pay­ments mar­ket is ex­pected to record a com­pound an­nual growth rate of 72.3% dur­ing 2017-2021 to reach $14 bil­lion in trans­ac­tion value by 2021, a mas­sive in­crease from the $1.6 bil­lion re­ported in early 2017.

In the last one year, Go-jek has made five ac­qui­si­tions in­clud­ing In­done­sian event man­age­ment and tick­et­ing firm LOKET in Au­gust 2017. It ac­quired Pune, In­dia-based Left­shift, a mo­bile app de­vel­oper, to strengthen its tech­nol­ogy hold in Novem­ber 2016.

In Oc­to­ber last year, it ac­quired MVCOMmerce, an In­done­sian e-pay­ment start-up. Last year, it ac­quired Pianta, a Ban­ga­lore, In­dia-based mo­bile plat­form, and C42 Engi- neer­ing, a bou­tique soft­ware en­gi­neer­ing firm.

Last year, it also joined a Se­ries A in­vest­ment round in Halodoc, a health­care net­work plat­form, in In­done­sia. It has now in­te­grated its own on-de­mand medicine de­liv­ery ser­vice, Go-med, with Halodoc.

With the Mid­trans ac­qui­si­tion, Go-jek would not only aug­ment its pay­ments tech­nol­ogy and ex­per­tise but also gain ac­cess to the for­mer’s ex­ist­ing cus­tomer base as it con­tin­ues to ex­pand the gamut of fi­nan­cial trans­ac­tions pro­cessed by Go-pay, its own dig­i­tal wal­let.

In Septem­ber, Go-jek pres­i­dent An­dre Soelistyo told CNBC that the com­pany was try­ing to em­u­late the suc­cess of China’s Ali­pay and Wechat Pay in In­done­sia. In­ter­est­ingly, Wechat-owner Ten­cent Holdings Ltd is now a Go-jek in­vestor and should have more than a few point­ers to offer on how to grow a cash­less pay­ments busi­ness.

Ri­val Grab is also am­pli­fy­ing ef­forts to ramp up its dig­i­tal pay­ments ser­vices. Early this year, it ac­quired In­done­sia’s Kudo, a start-up that al­lows those with­out a credit card or bank ac­count to make pur­chases on­line. This week, the firm an­nounced that its Grab­pay dig­i­tal wal­let can now be used at cash-based mer­chants, in­clud­ing restau­rants and hawker stalls, across Sin­ga­pore. It also plans to ex­tend Grab­pay to the whole of South­east Asia in 2018.

The lat­ter also formed a joint ven­ture with In­done­sian me­dia con­glom­er­ate Emtek to de­velop dig­i­tal pay­ments. Emtek, which re­cently re­vealed that it made a mi­nor­ity in­vest­ment in Grab, had done a cou­ple of ac­qui­si­tions in the e-money space. In its quar­terly fi­nan­cial re­port, it re­vealed that it had ac­quired a 50% stake in Nusa Inti Artha, the par­ent com­pany of pay­ment gate­way firm Doku, and a 90% stake in Es­pay Debit In­done­sia Koe. Both firms pos­sess the much-cov­eted e-money li­cence, which was re­leased by the Bank In­done­sia in a reg­u­lated man­ner.


Ac­qui­si­tion spree: In­dus­try ob­servers es­ti­mate the value of the deal at over $100 mil­lion.

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