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Bukalapak’s Biggest Backer Emtek, Grab Form Strategic Alliance In Indonesia As Tech Battle Heats Up

This article is more than 2 years old.

PT Elang Mahkota Teknologi (Emtek)—the biggest shareholder of e-commerce firm Bukalapak—is investing $375 million in ride-hailing giant Grab’s technology unit in Indonesia, forming a strategic alliance as the battle for dominance of Southeast Asia’s fastest growing digital economy heats up.

The alliance comes after Bukalapak raised $1.5 billion in Indonesia’s largest-ever initial public offering. The partnership combines Grab’s superapp with Emtek Group’s portfolio of media, all-commerce and content production businesses, the companies said in a joint statement.

The partnership bolsters Grab’s position in Indonesia, said Nirgunan Tiruchelvam, head of consumer sector equity research at Tellimer in Singapore. Grab has been competing for superapp dominance in Indonesia against Singapore-based Sea Group and GoTo, which was formed through the merger of the country’s largest tech companies Gojek and Tokopedia.

“There’s going to be a three-way slugfest,” said Tiruchelvam.

Grab and Emtek aim to focus on developing digital products for the country’s micro, small and medium-sized enterprises. While MSMEs account for 99% of all businesses in Indonesia, only 21% have any digital presence, the companies said. The companies will provide MSMEs digital solutions supported by Bukalapak, GrabFood, GrabKios, and GrabMart platforms.

“This is just the first step in our journey together,” said Neneng Goenadi, managing director of Grab Indonesia, said in a statement. “We are excited to join hands with Emtek Group and tap into Emtek’s broad media network and the unique quality of the all-commerce Bukalapak which is aligned with our commitment to empowering MSMEs to go online and provide digital services for mom and pop shops.”

Grab, which holds a stake in Emtek, is due to list on Nasdaq by the end of the year through a merger with blank-check company Altimeter Growth. The transaction announced in April values the combined entity at $39.6 billion.

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