Indonesian competition watchdog not in favour of Gojek-Grab merger

The Indonesian competition and consumer commission Yayasan Lembaga Konsumen Indonesia (YLKI) has reportedly expressed “rejection” of the proposed Gojek-Grab merger. According to YLKI, the merger risks violation of consumer rights as there will no longer be more choices for consumers.

First reported by Bisnis, the Indonesian watchdog said the merging of two rival ride hailing companies will create “unfair business competition”. The article said chairman Tulus Abadi said the current ride hailing industry is monopolistic in nature, and the Gojek-Grab merger could lead to one group setting the prices in the market. The Ministry of Transportation in Indonesia was also reportedly quoted in the article to not favour the merger, and said it could be “dangerous” for the overall transportation industry. Marketing Interactive has reached out to YLKI for additional information.

This comes shortly after publications all across Asia have been reporting on the potential merger between ride-hailing apps Gojek and Grab. Gojek then denied the merger and called the media reports inaccurate in an official statement to Marketing Interactive. "There are no plans for any sort of merger, and recent media reports regarding discussions of this nature are not accurate," Gojek's spokesperson told Marketing Interactive. Meanwhile, rival Grab declined to comment. The report was first made by The Information report, which said the two had a “serious conversations” about a potential tie up.

Both Gojek and Grab are no strangers to acquisitions and mergers. Most recently, Gojek was said to have acquired a minority stake Indonesian taxi operator Blue Bird for US$30 million. Gojek is now expected have a 4.3% stake in Blue Bird, which comes months after the former expressed interest in the latter. 

Meanwhile, approximately two years ago, Grab in a swift move acquired Uber’s Southeast Asia operations, integrating Uber’s ride-sharing and food delivery business in the region into its existing multi-modal transportation and fintech platform. The acquisition saw Grab taking over Uber’s operations and assets in Singapore, Malaysia, Indonesia, the Philippines, Thailand, Myanmar, Cambodia and Vietnam. The move made headlines across Southeast Asian markets with consumer watchdog's stepping in with provisional findings that the buyout had “lessened competition”.

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