GoTo Group – formed by the merger of Indonesia’s two most valuable startups Gojek and Tokopedia – has picked up stakes in Lippo Group’s investment arm Multipolar (MLPL) and retail unit Matahari Putra Prima (MPPA), three sources privy to the matter told DealStreetAsia.
GoTo has picked up stakes in the two listed entities through market transactions.
GoTo on Monday invested around 710 billion rupiah ($49.8 million) in both entities by picking up 710 million shares (or 4.8% stake) in Multipolar and a 6.7% stake in MPPA, which owns Hypermart and other retail brands.
Back in May 2021, Gojek had bought a 4.76% stake in MPPA. With the latest transaction, GoTo Group’s stake in MPPA is at 11.46%, according to two sources familiar with the development.
MPPA stock closed 0.5% down on the Indonesian bourse at 990 rupiah per share while MLPL share price dipped 1.79% to 550 rupiah apiece in Monday trade. In the year-to-date period, Multipolar’s share price has vaulted by 674.65% while MPPA’s share price has soared 842.86%.
As part of a two-way transaction, Lippo Group is also understood to be looking to invest a significant amount in GoTo’s pre-IPO round. One market source said the group could invest in high double-digits going up to even $100 million. As reported by DealStreetAsia last month, GoTo is said to be in talks to raise from $1.5 billion to $2 billion in its pre-IPO round that has already been oversubscribed.
GoTo’s purchase of stakes in Lippo Group’s entities and the latter’s proposed participation in the former’s pre-IPO round are seen as a larger move to further cement the ties between the two entities, according to the several industry sources aware of the matter.
Spokespersons of GoTo and Lippo Group declined to comment on a DealStreetAsia query related to the market transactions.
Brokerage firm Trimegah Sekuritas’s research head Willinoy Sitorus said, “If GoTo really picks up [stakes in] MPPA and MLPL, it will be a strong partner, as the retail business has to adapt and partner with tech companies. Hypermart (MPPA) is going to the online to offline (O2O) channel, and with GoTo, it will be a strong partnership between both groups.”
During the recently concluded Asia PE-VC Summit 2021, Lippo Karawaci president director John Riady had pointed out the significance of partnerships with tech majors to unlock the potential of traditional companies.
“I’m a believer that so-called offline companies have a lot of value add and will continue to grow. In a market like Indonesia, offline retail is still 30% of the total retail market,” Riady said, speaking at the Asia PE-VC Summit 2021.
Multipolar’s portfolio spread
Multipolar, Lippo’s investment arm, is currently broadening its investment portfolio, starting from early to late-stage investments.
With a net asset value (NAV) of over $1.5 billion, Multipolar has invested in over 40 companies since its inception in 2015. Multipolar also targets to invest in the late-stage, and pre-IPO and IPO companies, including Bukalapak, and GoTo Group.
Besides investing in tech companies, Multipolar also seeks to partner with tech companies and other Lippo business units, including the retail business (MPPA) and Matahari Putra Prima (LPPF), banking (Bank Nobu) and internet infrastructure (Link Net).
On the e-wallet business OVO, Lippo Group along with Tokopedia have made an exit following SE Asian ride-hailing and payments firm Grab’s increase in stake in the Indonesian payments firm as part of the ownership restructuring.
The deal, which is pending approval, will see Grab increase its stake in the e-wallet to 90% from 35% currently, according to a filing with the Indonesian administration and law ministry.
Lippo Group established OVO in September 2017 to enable retail and merchant payments before it evolved and secured investments from both Grab and Tokopedia, which has merged with Grab’s rival Gojek. Prior to the last transaction, Lippo held a 7.2% stake in OVO through two subsidiaries – PT Inti Anugrah Pratama and PT Prima Ecommerce Global.