Grab and GoTo are in advanced discussions for a possible merger, hoping to overcome years of losses in Southeast Asia.
According to Bloomberg, the two firms, valued at over US$25 billion, aim to finalise an agreement by 2025.
However, in a filing on February 4, GoTo has denied any ongoing merger talks, adding that it was not engaged in discussions with any party.
The company, which was formed in a May 2021 merger between ride-hailing firm Gojek and ecommerce platform Tokopedia, also noted separately that it “does not have any material corporate action plans for the next 12 months other than the implementation of share buybacks.”
On-and-off discussions for years
Earlier in 2024, similar reports surfaced about potential merger talks between the two firms, but GoTo also refuted those claims at the time.
The companies have reportedly engaged in on-and-off discussions for years but faced disagreements and potential antitrust challenges due to their dominance in key markets like Indonesia and Singapore.
If the merger proceeds this time, it could help lower costs and ease competitive pressure in the region.
Slower growth
While both firms have made significant progress towards profitability following their stock-market debuts, their growth has slowed significantly in recent years.
With customers cutting back on spending due to high inflation and interest rates, Grab and GoTo have seen lower demand for their services.
In response, both firms have pursued smaller strategic deals to strengthen their financial positions. Grab bought a supermarket chain in Malaysia (Jan 2022) and a reservation app in Singapore (July 2024), while GoTo sold control of its struggling ecommerce business to ByteDance’s TikTok for US$1.5 billion last year.
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