Singapore super app Grab has managed to bring in a prominent Indonesian businessman as a new investor to its Indonesian e-payment service Ovo—a move made to comply with a regulation covering a local share ownership requirement.
According to legal filings, Grab now holds 79.5% of shares in Ovo’s parent company after the latter’s new rights issue. That brings the Singaporean company’s stake down from the previous 90% it had after purchasing shares earlier in the month from Tokopedia, local conglomerate Lippo Group, and Japanese financial services company Tokyo Century.
Taking the bulk of the newly issued shares is an entity named Abhimata Anugrah Abadi, which is 99.5% owned by Alvin Sariaatmadja, president director at local media conglomerate Elang Mahkota Teknologi, better known as Emtek. Abhimata owned 12.4% of Ovo’s parent as of Thursday.
Grab signed a strategic partnership with Emtek earlier this year.
“We are excited to complete Ovo’s ownership restructuring process, in compliance with local regulations and through close coordination with the regulator,” a spokesperson for the e-payment operator said Friday when contacted by Nikkei Asia.
“With the support of shareholders, we are ready to accelerate the next phase of our growth, and look forward to offering an even broader range of differentiated payments and financial services solutions that are tailored to the needs of Indonesian consumers,” the spokesperson added.
Bank Indonesia regulations dictate that at least 15% of shares in an e-payment operator need to be held by Indonesian citizens and/or entities. Grab was seeking a local partner to comply with the regulation.
Aside from Grab and Abhimata’s ownership, 3.2% of Ovo’s parent is held by IDE Teknologi Indonesia, a local company with ties to an Indonesian one that Grab acquired, with the other 4.7% held by Cakra Finansindo Investama, a local investment firm.
With regulatory hurdle now cleared and majority ownership secured, Grab will look to expand its market share in the country’s competitive digital payments space.
According to research by Boku, a US mobile payment company, Ovo had 38% market share in 2020, while its main rivals—ShopeePay, an arm of Singapore’s Sea, and GoPay, the payment service from Indonesian private tech company GoTo—have shares of 15.6% and 13.2%, respectively.