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Business

Singaporean unicorn Garena bags $550m in funding, rebrands as Sea

Cathay Financial, others pony up cash for online startup's diversification

Indonesia is a key target for the Shopee e-commerce platform.

SINGAPORE -- Online gaming and e-commerce venture Garena on Monday said it raised $550 million in a round of fundraising that involved Cathay Financial Holding, one of Taiwan's largest financial services providers by assets.

The Singaporean startup also announced the rebranding of its holding company, Garena Interactive Holding, to Sea -- a name inspired by the abbreviation for Southeast Asia.

Sea will provide an umbrella for three main businesses: e-commerce platform Shopee, mobile wallet service AirPay and Garena, the original online gaming operation.

The latest funding round attracted a diverse set of investors from Asia and beyond, including Indonesian venture capital player GDP Venture, Philippine conglomerate JG Summit Holdings, an investment arm of Taiwanese retailer and food conglomerate Uni-President Enterprises, and U.S. investment firms Farallon Capital Management and Hillhouse Capital.

The startup has yet to disclose its latest valuation. It was last valued at $3.75 billion, when it raised $170 million in March 2016. That put it comfortably in unicorn territory, reserved for ventures worth $1 billion or more.

Forrest Li, Sea's founder, chairman and group CEO, said in a news release that the "wisdom and experience" of the latest investors will "play an important role in our continued organizational growth."

Sea intends to use the funds to foster Shopee, focusing on Indonesia -- Southeast Asia's biggest consumer market. Shopee currently does business in seven Asian markets: Indonesia, Vietnam, Thailand, Singapore, Malaysia, the Philippines and Taiwan. Its annualized gross merchandise value has doubled in the past nine months to exceed $3 billion, according to the company.

But competition is intensifying as other players ramp up investments in Southeast Asia's e-commerce and mobile payment sectors. Earlier this month, reports emerged that Chinese tech company Tencent Holdings led a $1.2 billion investment round in Indonesian ride-hailing and payments app Go-Jek.

Last year, China's Alibaba Group acquired Southeast Asian e-commerce company Lazada for $1 billion. Alibaba is also expanding the network of retailers in Southeast Asia that accept Alipay, its mobile payment service.

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