PUC Founder acquires IT business solution Enovax at US$1.43 million

Thu Apr 27, 2017 - 11:10am UTC
PUC Founder acquires IT business solution Enovax at US$1.43 million
Founder of Enovax, Erwin Foo

ACE Market-listed PUC Founder (MSC) Bhd has acquired the entire stake in Enovax Pte Ltd for S$2 million (about US$1.43 million) in a bid to expand further into the technology business.

The acquisition follows a Memorandum of Understanding (MoU) inked between the two parties on April 11 this year that negotiated the terms of the acquisition.

The deal will see PUC Founder inking a conditional sale of shares agreement with Enovax’s sole shareholder Foo Yong Jio to buy 600,000 ordinary shares of the company which represented a 100 percent equity interest.

“We are extremely excited with the acquisition of Enovax as it will contribute to PUC’s expansion and long-term growth plans to become a leading digital services provider. Enovax’s strength is in providing a full suite of one-stop solutions for small and medium enterprises,” said PUC’s CEO Cheong Chia Chou.

PUC Founder is set up by China Founder Group and is the first China government-linked company to list on the ACE Market of Bursa Malaysia. The firm extends its reach throughout Asia and is involved in media and advertising, e-payment services, and renewable energy.

On the other hand, Enovax is an IT business solution provider with expertise in online ticketing and payment gateway systems such as e-wallet, prepaid card, and e-voucher management systems. The company’s strengths also lie in system implementation, business process management, and resource planning.

“It provides a full-suite of one stop solutions for SMEs coupled with a stable of talented IT professionals under the leadership of Erwin Foo which will be integral in elevating the technological expertise and competency across all PUC’s businesses, especially in technology, e-commerce and integrated media services,” Cheong added.

That is, PUC will stand to benefit from the expertise and domain knowledge that Enovax possesses in software development of customized information technology solutions and services for enterprise businesses, electronic commerce solutions, and internet-driven applications, among others.

As part of the MoU leading up to the acquisition, Enovax CEO and chairman Erwin Foo was also made PUC Founder’s Chief Technology Officer for a minimum of three years.

Commenting on the acquisition, the new CTO of PUC Founder said, “there is a great synergy between Enovax and PUC and we look forward to building on the collective strengths of the companies and shared commitment to delivering innovation and creativity to aggressively grow PUC’s businesses.”

While the proposed deal is expected to contribute positively to the PUC Founder’s future earnings, it will not have any effect on PUC Founder’s share capital and substantial shareholders’ shareholdings. It will not impact the company’s gearing, net assets per share or earning per shares.

Shares in PUC Founder closed unchanged at MYR 0.135 with over 6.76 million shares traded on Wednesday. At this price, the company has a market valuation of MYR 158.1 million (about US$36.4 million).

According to PUC Founder, the acquisition will be paid in full by June 30 next year via internally-generated funds and a private placement which it proposed last March.

By Vivian Foo, VCNewsNetwork

This news is published on Reuters.

Vivian Foo is a reporter who writes about Southeast Asia’s technology and startup space. The entry point which led her to write about the startup ecosystem was her fascination of the dot-com boom. She is taking a deep dive into how the entrepreneurial mindset works and hopes to share the insights, innovation, and stories of the startups with her readers.