Temasek, Google set to invest in Tokopedia

Google and Temasek have agreed to invest about US$350 million (S$476 million) in Tokopedia, people familiar with the matter said, a major cash infusion that will bankroll the Indonesian e-commerce giant's post-Covid-19 expansion.

The Alphabet unit and Singapore's investment firm could sign an agreement for the funding soon, the people said, asking not to be identified discussing the deal before it is formally concluded. The financing falls short of the initial goal of between US$500 million and US$1 billion that Bloomberg News reported in July, though Tokopedia may still be looking for investors.

Tokopedia, which is backed by SoftBank Group, was said to have held talks with US Internet giants including Facebook, Microsoft and Amazon. The backing of Google and Temasek is a vote of confidence for one of Indonesia's biggest e-commerce operators, which rode a surge in online shopping during the pandemic.

America's largest Internet corporations have looked increasingly towards Asia as growth in the US and Europe slows, seeking to tap the region's rapidly growing smartphone-savvy population.

Facebook is buying a stake in India's Jio Platforms, while its WhatsApp unit struck a deal to invest in Gojek, which has a popular digital payments service called GoPay. Representatives for Google, Tokopedia and Temasek declined to comment.

Indonesia's e-commerce market is projected to expand from US$21 billion last year to US$82 billion by 2025, according to a recent study by Google, Temasek and Bain & Co.

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A version of this article appeared in the print edition of The Straits Times on October 27, 2020, with the headline Temasek, Google set to invest in Tokopedia. Subscribe