Indonesian mobile payment startup OVO is said to be in talks to acquire a third local fintech startup in a deal expected to be worth around $30-$40 million, according to a source familiar with the matter.
Consumer lending startup Glotech Prima Vista is set to be the latest target company for OVO, which has been on an acquisition spree. OVO has reportedly acquired P2P company Taralite and is said to be in the process of completing a deal with mutual fund platform Bareksa, as first reported by DEALSTREETASIA.
We have reached out to both OVO and Glotech for comments, both declined to comment on “market speculations”.
According to our source, the Glotech deal was largely spurred by OVO’s interest in the company’s talent, particularly its engineering expertise, which would accelerate OVO’s expansion into various other subsectors of financial services.
Glotech is more commonly known in Indonesia through its fintech brand Do-It. The company focuses on consumer loans, using big data and artificial intelligence to speed up the borrower data verification process.
Founded in 2018, Do-It was one of the three startups OVO had signed a partnership deal with last month – the other two being Taralite and Bareksa.
Through the partnership with OVO, Do-It will look to reach out to OVO’s user base of 115 million in 300 cities to offer its lending service, according to a report by Daily Social.
The partnership and acquisitions of fellow fintech firms is part of OVO’s effort to provide a more comprehensive offering in the financial sector, which it had said it targets to simultaneously roll out by the first quarter of this year.
It is understood that the deal with Taralite has enabled OVO’s entry into the online credit space, while Bareksa and Do-It will help the payment company tap into the mutual funds and lending businesses. OVO is also looking to expand into insurance segment.
The multiple acquisitions carried out by OVO mirrors a similar move by rival GOJEK which in late 2017 announced the acquisition of three fintech startups.
The ride-hailing unicorn acquired offline payments processing company Kartuku, top online payment gateway Midtrans, and local community group-based saving and lending network Mapan in an effort to beef up its payments arm, Go-Pay.
OVO competes head to head with Go-Pay in a stiff and bloody battle, but the Grab-backed company claims to be the largest digital payments platform in the country with 1 billion transactions recorded in 2018, a 75x increase in transaction volume. The top three transactions conducted on OVO pertain to transport, retail and e-commerce.
Having seen Go-Pay dominate the country’s mobile payment space in the past, OVO seemed to have stepped up its game in the last couple of years fueled by partnerships and investments in the company by regional giants Grab and Tokopedia.
As first reported by us last month, Tokopedia became a stakeholder in OVO following the acquisition of less than 20 per cent stake in OVO, subscribing to fresh equity shares of the payment company. This followed an undisclosed investment from the region’s largest ride-hailing startup Grab last year.