Gojek Thailand changes the weather outside for AirAsia's digital flight

To bolster its digital ventures, Asia’s largest budget carrier AirAsia Group is taking over the Thailand operations of Indonesian ride-hailing unicorn Gojek for US$50 million. Can the airline group’s digital play really compete against Grab, and to a certain extent, Gojek?

In early July, AirAsia surprised the market with its Gojek Thailand announcement. Gojek will exit Thailand by 31 July

The budget airline’s head honcho Tony Fernandes claims AirAsia’s super app platform is now valued at US$1 billion

While AirAsia didn’t have to build its Thai business from scratch, it will now have to secure funding for its digital goals

It will also have to raise money fast for the struggling airline business as Southeast Asia battles a third wave of the pandemic

How does an airline suffering through the pandemic end up acquiring Gojek Thailand? That too for US$50 million.

More strikingly, how does this airline’s ‘super app’ end up getting valued at least US$1 billion?

A unicorn valuation, and more importantly, a valuation more than what the airline’s whole business is worth. We’re talking about Malaysia’s budget carrier AirAsia Group, of course. Its latest market capitalisation, notably, is only RM3.2 billion (US$760 million).

Earlier this month, the group—a struggling airline business itself—took on Gojek’s struggling Thailand business to bolster its digital venture. In turn, the Indonesian ride-hailing unicorn would receive a 4.8% stake in AirAsia Group’s super app business.

AUTHOR

Ka Kay Lum

Based in Kuala Lumpur, Ka Kay covers investment activities, aka following the money, across Southeast Asia and in-depth stories on the often-overlooked Malaysian startup ecosystem. She was previously a regional writer for Nikkei-owned DealStreetAsia.

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