Issue 38

Indonesia’s Gojek secures funding from insurer AIA Group unit

Indonesia-based ride-hailing giant Gojek has secured an unspecified amount of investment from insurance firm AIA Indonesia as part of its ongoing Series F funding round. The investment comes alongside a strategic partnership agreement between the two companies, the companies said in an official statement. 

As part of the partnership, AIA Indonesia will become a key pillar of Gojek’s financial services strategy by providing life and health insurance services and wellness propositions to its users, drivers, and merchants across the country. The partnership also aims to raise awareness of life and health insurance solutions in the country. 

“Our in-depth consumer knowledge and digital footprint across the country, combined with AIA Indonesia’s expertise in financial protection solutions, will enable the partnership to bring our users greater value through an expanded range of products and services,” said Gojek co-founder Kevin Aluwi. AIA Indonesia is a member of Hong Kong-listed AIA Group Limited, which claims to be the largest independent publicly listed pan-Asian life insurance group. 

The insurance company becomes the latest corporation to join Gojek’s cap table in its Series F round after the Jakarta-based company announced an investment from Mitsubishi Motors Corporation, Mitsubishi Corporation, and Mitsubishi UFJ Lease & Finance as part of its ongoing round. The Series F round was brought to its first close in March following a $100 million follow-on funding from local conglomerate Astra International and expects to close the round at $2 billion before the end of the year. 

However, Gojek President Andre Soelistyo said at the DealStreetAsia Asia PE-VC Summit 2019 that the company may upsize the current round. Prior to the first close, Gojek had secured Series F investments learnt to be over $1 billion from at a nearly $10-billion valuation from investors including Provident Capital, Google, and Tencent. 

According to a recent report by Reuters, Amazon could be the next tech giant to pick up a stake in Gojek after the two companies had reportedly been in talks for potential investment. 

Gojek has earlier said that it plans to invest the Series F funds across transport, food delivery, logistics, mobile payments, and merchant services businesses. It also plans to use proceeds to accelerate its market expansion across Southeast Asia, a market which has been dominated by the heavily-funded Grab. We had earlier reported that Grab was looking to raise up to $5 billion in the ongoing Series H round amid increased investor interest. 

Investors in the round include Toyota Motor Corporation, Oppenheimer Funds, Hyundai Motor Group, Booking Holdings, Microsoft Corporation, Ping An Capital, and Yamaha Motor.

From – Deal Street Asia

Axiata seeks Malaysia, Indonesia mergers after Telenor talks end

Axiata Group Bhd. is pursuing mergers as a key strategy despite an abrupt end to its plan to form an Asian mobile giant with Telenor ASA, its top executive said. Malaysia’s largest wireless carrier, which provides telecommunication services to more than 300 million people from India to Cambodia, could see mergers happening for its Indonesian and Malaysian operations within three to five years, Chief Executive Officer Jamaludin Ibrahim said in an interview. 

“Consolidation is key to future-proof us in the medium term given the challenges in the industry,” Jamaludin said at his office in Kuala Lumpur. “The cancellation of the merger does not deter us from looking at other possibilities.” Earlier this month, Axiata ended talks with Telenor on combining their Asian operations to create a company with $13 billion in sales, just a week after saying the deal was on track. 

Telecommunication companies are turning to mergers and acquisitions to fend off competition and amass enough scale to adopt new technologies. Southeast Asian deals in the sector doubled from a year ago to $2.7 billion so far in 2019, according to data compiled by Bloomberg. Axiata has received offers for its $3 billion tower unit Edotco Group Sdn., Jamaludin said, confirming an earlier Bloomberg report. 

The company is duty-bound to consider all offers and will explore all options for Edotco including reviving a listing plan, with a decision to be made by the end of the year, he said. 

Informal approaches 

Axiata has also had informal approaches from several investors for its other assets, he said, declining to say if CK Hutchison Holdings Ltd., the Hong Kong conglomerate backed by tycoon Victor Li, has expressed interest in combining their Indonesian telecommunications operations. Despite the canceled merger, Axiata’s shares have outperformed the benchmark to gain 7.4% in 2019, compared with a drop of 5.3% for the FTSE Bursa Malaysia KLCI index. 

The company is expected to report a 1.2 billion ringgit ($287 million) net income this financial year, a turnaround from the 5 billion ringgit loss in 2018, according to the average estimates by analysts polled by Bloomberg. 

While the company will keep focusing on operational efficiency, “we believe that profit and cash aren’t good enough because the industry is slowing down,” Jamaludin said. “For the last three years, we have been talking to parties in both countries,” he said, referring to Malaysia and Indonesia. “One of which resulted in almost a merger with Telenor.”

From – Deal Street Asia

Self-driving truck startup TuSimple mops up $120m from Chinese, HK firms

Self–driving truck startup TuSimple said on Tuesday it raised an additional $120 million from investors to be used to expand long-haul services for truck fleets and jointly develop an autonomous commercial vehicle with truck makers and suppliers. TuSimple said the new funds were part of a round of fundraising that was oversubscribed and reached a total of $215 million. 

The company’s new investors include Chinese alternative investment firm CDH Investments, Hong Kong-based investment firm Lavender Hill Capital and Korean auto supplier Mando Corp TuSimple said the latest investments bring its total funding so far to $398 million. That same round of funding included an investment by UPS Ventures, the venture capital arm of United Parcel Service Inc. 

TuSimple is also conducting road tests for UPS’s supply-chain business on a busy stretch of highway covering a little over 100 miles (160 km) between Phoenix and Tucson. TuSimple‘s other investors include Chinese online media company Sina Corp and U.S. chipmaker Nvidia Corp. Companies from Silicon Valley tech firms to traditional carmakers are racing to put fully commercial self–driving vehicles on the road. 

Efforts by robotaxis companies such as General Motors Co unit Cruise and Uber Technologies Inc have stumbled because it is difficult and costly to develop self–driving cars capable of anticipating and responding to humans in urban areas while picking up and dropping off passengers at random locations, at random times. But self–driving trucks are seen as an easier proposition as most run consistently on predictable, revenue-generating highway routes around the clock, often early in the morning when driving conditions are ideal. “Our goal is still to have a factory-produced (self–driving) truck by the 2023 time frame,” TuSimple Chief Financial Officer Cheng Lu told Reuters. 

Until the company has its own specially developed truck on the road, the startup‘s aim is to expand the service it is currently running for 18 truck freight customers in the United States using retrofitted trucks. TuSimple currently has a driver and engineer in each truck cab on freight runs while its self–driving technology is tested out. 

TuSimple also ran a two-week test for the U.S. Postal Service earlier this year transporting mail across three southwestern states.

From – Deal Street Asia

Mizuho, Softbank dole out $500m loan to car leasing app Fair

Car leasing startup Fair said on Tuesday it had raised $500 million in loans from a group of creditors, including Mizuho Bank and Japan’s SoftBank Group Corp, as it looks to expand its leasing services to Uber drivers. Founded in 2016, Santa Monica, California-based Fair, raised $385 million in a SoftBank-led funding round in December 2018. 

SoftBank has stakes in Uber Technologies Inc, General Motors Co and its Cruise self-driving car, China’s Didi Chuxing, South-east Asia’s biggest ride-hailing firm Grab, and India’s Ola. These holdings reflect SoftBank’s growing influence in the emerging fields of AI and autonomous driving, driven by its investments through the nearly $100 billion SoftBank Vision Fund. 

Fair has partnered with Uber to rent out cars to users who want to drive for the ride-sharing company. “Too often, people who want to drive for Uber can’t get reasonable rates on a car loan or even get access to one at all, so we’re taking care of that for them,” Fair founder and chief executive officer Scott Painter said. Fair allows drivers to lease cars from various auto-dealers without signing long-term or fixed-term contracts.

From – Deal Street Asia

Vietnam’s social media crowd swells with new firms to take on Facebook, Google

A new social network has entered the already crowded field in Vietnam as the communist party squeezes U.S. tech giants Facebook and Google with a new cybersecurity law. 

Lotus, a social network that allows users to create content and share posts to a home page, had received 700 billion dong ($30.14 million) in funding from tech corporation VCCorp and hoped to raise another 500 billion dong, company General Director Nguyen The Tan said at the launch ceremony. 

“Lotus was born not to compete with Facebook or any other social networks,” Tan said late on Monday. “We will focus on content and content creation.” Information Minister Nguyen Manh Hung, who was at the launch, has urged Vietnamese companies to create viable domestic alternatives to foreign social media platforms which are more difficult for the government to control. 

Last month, a Facebook-style app, Gapo, also made its debut. Older domestic social platforms such as VietnamTa and Hahalolo have struggled to build large user bases. Hung said he hoped that eventually the number of Vietnamese people using domestic social networks would be as high as the number using foreign platforms. 

There were 58 million Facebook users and 62 million Google accounts in Vietnam as of August, government data showed. There are no comparable figures for domestic networks. Despite economic liberalisation and increasing openness to social change since the 1990s, the ruling Communist Party retains tight media censorship and does not tolerate dissent. Several activists and dissidents have been arrested or jailed for posting online content considered to be “anti-state”. 

Vietnam has tightened internet rules over the past few years, culminating in a cybersecurity law which came into effect in January requiring foreign companies like Facebook to set up local offices and store data in the country.

From – Deal Street Asia
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