In a surprising twist, SoftBank Group Corp., alongside Provident Capital Partners and Peak XV, is involved in an effort to replace Patrick Walujo as CEO of GoTo Group. This move could potentially quicken discussions about an acquisition by Grab Holdings Ltd.
According to insiders, several GoTo shareholders have signed a memo to the board requesting an extraordinary general meeting. These shareholders, including some of GoTo’s co-founders, are advocating for a vote on key issues, notably the replacement of the CEO who has overseen a decline in the company's market value by more than 40% during his tenure. Additionally, Walujo is viewed as resisting a potential takeover by Grab.
The push to remove Walujo, who took leadership in 2023, is happening amid heightened investor speculation that the two Southeast Asian giants might soon reignite merger discussions. The likelihood of a takeover is growing following recent Indonesian government statements about engaging with both ride-hailing and delivery companies for a potential deal.
An Indonesian official mentioned that the nation's sovereign wealth fund, Danantara, is expected to play a role in merging the companies. Earlier this year, the fund began evaluating a possible minority stake in the combined entity, as reported in June by informed sources.
Citigroup analyst Ferry Wong highlighted in a note that significant upside potential remains for investors if the deal succeeds. He stressed that the government's remarks suggest that a deal is actively considered, and Danantara’s involvement could ease concerns regarding national interest and regulations.
GoTo’s share price surged by up to 4.5% in Jakarta, overcoming earlier losses of up to 3% and raising the company’s market capitalization to roughly $5 billion. Meanwhile, Singapore-based Grab, listed in New York, holds a market cap of $24 billion.
Upon taking over at GoTo, Walujo initiated strategies to strengthen the business. Within two years, he divested the unprofitable Tokopedia e-commerce unit, developed GoTo’s payment platform, and expanded its nascent lending services. These efforts led to profitability on an adjusted basis, yet the company’s shares have plummeted nearly 50% since his appointment, largely due to macroeconomic uncertainties and fluctuating revenue growth.