|Tiki and Sendo have decided to merge to tackle competition
Dealstreet Asia quoted some people familiar with the matter as saying that the two local firms Tiki and Sendo have just agreed to merge to deal with the sharpening competition in the local market.
The move comes in the context of powerhouses being born in e-commerce, with Lazada backed by Alibaba and Shopee by Singaporean tech giant SEA Group.
E-commerce, despite being lauded as a fertile sector in Vietnam, is not accommodating for players at all. To date, not a single e-commerce firm at the market has made any profit.
As of the end of 2018, the accumulated losses of Tiki were nearly VND1.4 trillion (US$60.87 million), while Sendo saw a deficit of about VND1.3 trillion (US$56.5 million).
Shopee’s accumulated losses exceed VND2 trillion (US$86.96 million). Lazada, as of March 31, 2019, reported about VND7.111 trillion (US$309.17 million).
Otherwise, constantly welcoming new investments has fragmented local firms’ shareholder structure. At the end of 2019, 61.1% of Sendo's shares were held by overseas investors after getting US$61 million capital in its Series C investment round. In addition to FPT, Sendo’s shares have been picked up by SBI, Beenext, Econtext Asia, and Daiwa.
Tiki also raised capital in June and December last year. The two main shareholders are VNG with 24.6% and JD.com with 21% of the shares. The others include Ubiquitous Traders Pte., Ltd. (nearly 9%), CyberAgent, STIC, and Sumitomo.
Last week, Tiki surprised the local e-commerce market by announcing plans to be listed on the local stock exchange.