Ride-hailing and payments company Gojek has completed a merger with ecommerce firm Tokopedia, creating a new Indonesian technology powerhouse called GoTo Group.

The $18bn merger makes GoTo the largest technology group in the Southeast Asian nation. The merged company is reportedly preparing for a dual listing in Indonesia and the US later this year in which it is said to be seeking a market valuation of up to $40bn.

Based on the most recent funding valuations Gojek is worth $10.5bn and Tokopedia $7.5bn. Together, the two companies had more than 1.8 billion transactions in 2020 and over 100 million active users to date.

Super-app Gojek has been downloaded more than 125 million times – nearly half the population of Indonesia. It has more than 300,000 merchants on its platform. Meanwhile, Tokopedia is the second-largest online shopping site in Indonesia.

Combined, the two companies will aim to expand their reach among consumers in the fast-growing Indonesian economy and fend off competition from rivals Grab and Sea Group.

Gojek co-CEO Andre Soelistyo will lead GoTo, while Tokopedia’s Patrick Cao will serve as GoTo president. Kevin Aluwi will continue as CEO of Gojek and William Tanuwijaya will remain CEO of Tokopedia.

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The announcement confirms months of speculation that the two companies were nearing completion of the merger.

According to the firms’ figures, their combined ecosystem encompasses 2% of Indonesia’s gross domestic product (GDP).

Backers of the companies include SoftBank, Tencent, Alibaba, Facebook, Visa and Google. Goldman Sachs is acting as the financial advisor to Gojek while Citi is acting as financial advisor to Tokopedia.

The two brands have worked together since 2015, when Gojek drivers began delivering Tokopedia ecommerce orders.

“Gojek drivers will deliver even more Tokopedia packages, merchant partners of all sizes will benefit from strengthened business solutions and we will use our combined scale to increase financial inclusion in an emerging region with untapped growth potential,” said Soelistyo.

“For the consumer, GoTo Group will continue to reduce frictions and provide best in class delivery of goods and services.”

The GoTo merger announcement follows the $40bn merger of rival Grab with a special acquisition company. The Singapore-headquartered company also provides delivery, ride-hailing and financial services.