JAKARTA - The leading ride-hailing company based in Singapore, Grab, is reported to have bought a stake in PT Elang Mahkota Teknologi Tbk (EMTK), also known as Emtek.
Quoted from The Straits Times, Thursday, April 15, Grab, supported by Softbank, poured out S $ 366 million or around IDR 4 trillion in the purchase of 4 percent shares in the conglomerate company Eddy Kusnadi Sariaatmadja.
On April 5, 2021, Emtek announced that it had completed the sale of new shares through a private placement worth IDR 9.3 trillion, with Naver Corporation, South Korea's largest web search engine, and an investment firm called H Holdings Inc becoming a share buyer representing approximately 8.4 percent of the company. This private placement increases the paid-up capital by Emtek.
A source from The Straits Times, who did not want to be named, said that Grab bought Emtek's shares through H Holdings. The proceeds from Emtek's private placement will be used to grow the business and help fund day-to-day operations.
After the private placement, the main Emtek shareholders were diluted. For example, ownership of founder Eddy Sariaatmadja fell to 22.96 percent from 24.9 percent. Another major shareholder is conglomerate Anthony Salim, who is one of the richest men in Indonesia, also stepped down.
Meanwhile, Emtek Managing Director Sutanto Hartoto did not answer written questions sent by The Straits Times about Grab's investment and the possible merger of the two digital payment companies.
Grab also did not provide an immediate response to a similar question. Indonesian stock market regulations require that ownership of five percent or more in public companies be disclosed to the public.
Thus, Grab's ownership is around 4 percent, making no one oblige investors, in this case Grab or Emtek, to announce this. In September 2019, Reuters reported that Grab was in talks to merge OVO, with the e-money firm DANA which is backed by Emtek and Ant Financial.
OVO and arch-rival GoPay, and another major player ShopeePay, from Singapore-based technology startup Sea Ltd, are making a further push to capitalize on the digital payments industry in the world's fourth most populous country.
Banking penetration is still low in Indonesia and digital banking is expected to be a game changer in this country. About 52 percent of Indonesian adults, or 95 million, are unbanked, according to the World Bank.
GoPay is part of Gojek, which in December last year (2020) spent 160 million US dollars (equivalent to 214 million Singapore dollars) to increase its ownership in Bank Jago to 22.16 percent.
Gojek e-wallet customers using the ride-hailing app will have the opportunity to open an account at Bank Jago, which launched its app on Thursday (April 15) and will become the country's first fully digital bank.
Meanwhile, OVO is an in-app payment service from Indonesia's second-largest e-commerce site Tokopedia, which will announce its merger with Gojek in early May. This merger could encourage Tokopedia to break off a strategic partnership with OVO.
Sea Ltd also acquired Indonesia's unregistered Economic Welfare Bank (and renamed it SeaBank) earlier this year, saying this would allow it to serve customers at its subsidiary Shopee, which several years ago overtook Tokopedia as Indonesia's largest e-commerce site.
OVO is preparing to acquire a bank that can be turned into a digital bank. Meanwhile, Sea is eyeing Aladin's Bank, seeking to make it an online partner for its subsidiary Shopee.
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