Grab to own majority stake in digital payment service OVO as it buys out Tokopedia

Grab has increased its stake in digital payment service OVO to about 90%, buying over the shares from Tokopedia, The Straits Times (ST) reported. Bloomberg also reported that Grab increased its holding in Bumi Cakrawala Perkasa, OVO’s parent, from about 39%, according to a filing with the ministry of legal affairs. OVO's spokesperson told MARKETING-INTERACTIVE that it was pleased to complete the first part of a wider exercise to restructure its ownership, and welcomes a greater commitment from Grab.

"We're working in close consultation with the regulators to complete the ownership restructuring process, and are confident this will allow us to better serve the financial services needs of Indonesians," the spokesperson said. According to multiple sources including ST, Bloomberg and Nikkei Asia, the restructuring of OVO's ownership after Tokopedia's deal to merge with Gojek, which owns GoPay - OVO's major competitor in the Indonesian market.

While Grab's acquisition of Tokopedia's OVO shares will resolve the conflict between OVO and Gojek, media outlets said this also meant that the payment battle will intensify between Grab and GoTo, the new company formed by Gojek and Tokopedia's merge. At the same time, this move will allow Grab to focus on boosting its financial services in the region. Meanwhile, Grab is reportedly in the process of selling a piece of its OVO stake to investors in Indonesia to comply with the country's regulations, ST said quoting its sources. 

Grab is in the midst of going public in New York through a US$40 billion merger with Altimeter Growth, which is expected to close by the end of the year. According to Grab, the proposed transactions will value the platform at an initial pro-forma equity value of approximately US$39.6 billion at a private investment in public equity size of over US$4.0 billion and will provide Grab with approximately US$4.5 billion in cash proceeds. 

Just yesterday, the ride-hailing company appointed Alex Hungate, CEO and executive director of the in-flight catering and ground handling company, SATS as chief operating officer, effective 4 January. He takes over from Tan Hooi Ling who, according to The Business Times, will still oversee several areas of Grab's operations, including HR, tech and corporate strategy.

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