Brief: Korean telco drops Indonesia ecommerce plan, sells Elevenia stake to Salim

James Lee, CEO of Elevenia. Photo credit: Elevenia.

The news (extracted from Pulsenews):

• Korean telco and internet enterprise SK Planet is exiting its Indonesian ecommerce business Elevenia.
• Elevenia is a joint venture set up by SK Planet and Indonesian telco XL Axiata in 2013.
• SK Planet reportedly sold its 50 percent stake to Indonesian retail conglomerate Salim Group, which has recently partnered with Korean retailer Lotte for a separate ecommerce business in Indonesia.
• After Indonesia, SK Planet is reportedly considering withdrawing from further markets like Malaysia, Thailand, and Turkey, though the firm later said it remains committed to its venture in Malaysia, 11Street – a collaboration with Celcom.

Why it matters:

• China’s Alibaba left no doubt about its ambitions for Indonesia ecommerce landscape when it participated in a massive investment round for Tokopedia. As such, competitors are preparing for a long and expensive battle, with some industry players predicting consolidation under these circumstances.
•  Japanese firm Rakuten made a similar decision last year, pulling out of its Southeast Asia operations to focus on other markets.
• Salim Group now fully owns Elevenia. XL Axiata, the Indonesian telco who held the other part of the ecommerce firm, also sold its stake to Salim Group, it was later reported.
• Salim Group has been ramping up efforts to expand into digital business opportunities. It recently acquired a controlling stake in a bank to push digital payments.

Update August 24: Added information about XL Axiata also selling its stake to Salim Group.

Update September 4:  Added information about SK Planet’s commitment to remain in Malaysia.