- Alibaba is supposedly in talks to make an investment in Tokopedia.
- The Chinese firm is expected to take the lead in a US$500 million funding round for the Indonesian ecommerce marketplace. Existing investors SoftBank and Sequoia Capital are also slated to join the round.
Why it matters:
- Earlier this year, Bloomberg reported that Tokopedia has been in investment talks with JD, Alibaba’s Chinese rival. The complexity of these negotiations could be the reason why Tokopedia hasn’t confirmed any of these rumors and why no deal has been formally announced. It’s also not clear whether an Alibaba investment means that JD would back out, though sources told Bloomberg an alliance with Alibaba would likely preclude a deal with JD.
- Chinese tech firms are firmly placing their stakes in Southeast Asia. The biggest bet so far was Alibaba’s takeover of Lazada, which operates across the region. Aligning with the right partner could become a matter of survival for local tech firms, as competition is fierce and the Chinese firms bring much-needed funds and technology expertise.
- If Alibaba invests in Tokopedia, this would cement the Chinese company’s position in Indonesia’s ecommerce landscape and turn Tokopedia and Lazada into allies.
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