Post-acquisition, it’s ‘business as usual’ for iPay88
By Lum Ka Kay October 13, 2015
- For buyer NTT Data, acquisition marks a serious entry into South-East Asia
- Japanese firm holds majority stake, iPay88 management remains in Malaysia
JAPAN’S NTT Data sees its acquisition of a majority stake in Kuala Lumpur-based regional online payment systems provider iPay88 Sdn Bhd as marking its serious entry into South-East Asia, while it would be “business as usual” for the Malaysian company.
NTT Data, with more than 77,000 employees worldwide and with annual revenue of US$12.7 billion in its latest fiscal year, has taken slightly more than a 50% stake in iPay88, according to company officials. The cost of the acquisition has not been disclosed.
iPay88, a leading online payment systems provider in South-East Asia whose services are available in Indonesia, Malaysia, Singapore, Thailand, the Philippines and Vietnam, will continue to hire local talent to run its operations, its executive director and cofounder Chan Kok Long told a press conference in Kuala Lumpur on Oct 12.
“Key management will still be in Malaysia, in terms of technology and methodology developments. Overall, the corporate strategy and market direction of iPay88 will not undergo any significant change,” he said.
However, he said that together with NTT Data, the company will be rolling out “new and revolutionary online payment solutions” in Malaysia, Singapore, Thailand and Vietnam.
With the acquisition, iPay88 gets to leverage on NTT Data’s global reputation to grow its presence in uncharted markets, added iPay88 executive director and cofounder Lim Kok Hing.
It also gets to incorporate some of the features of NTT Data’s Cafis (Credit and Finance Information System) payment solution to fit the domestic needs of the markets it is in, he said.
“We will certainly benefit from NTT Data’s experience … from consumer payments to bank-to-bank payments, by having access to some of the cutting-edge technology for online payment solutions,” said Lim.
Meanwhile, Chan said iPay88 is recording double-digit year-on-year growth, and expects to maintain this rate over the next three years despite competition from new players.
Although he did not give any numbers at the press conference, according to its income statement for the financial year ended December 2013, revenue stood at RM3.7 million (US$870,000 at current rates) while net profit was RM1.1 million (US$259,000).
NTT Data’s serious SEA play
For NTT Data, the acquisition of iPay88 allows the company to squarely position itself in the online payment space in South-East Asia.
“One of the objectives of this acquisition is to capitalise on the growing demand for cross-border online payments between our home market [of Japan] and other markets in Asia Pacific,” said Masahiro Kawai, head of NTT Data’s Cards and Payments Services Division.
With many Japanese coming to Malaysia to work, start a business, or travel, he said the idea is to bring NTT Data’s services to Malaysia, and to take iPay88’s solutions to Japan.
NTT Data also expects to co-create new electronic payment services, more innovative products and services, as well as acquire more merchants in Malaysia, Singapore, Thailand and Vietnam, Kawai said, although he declined to elaborate.
The company’s acquisition of iPay88 was mainly driven by the latter’s “strong customer base in the region and its technology,” Kawai said.
He also said that NTT Data intends to establish a group of companies in the South-East Asian region through acquisitions, with iPay88 perhaps being the core company within this group.
“We will continue our M&As (mergers and acquisitions) in the region. As soon as we find a company with good solutions, we will be very aggressive to go in full-force to seal the deal,” he added.
NTT Data acquires iPay88’s Malaysian operations
Digerati50: Turning chance into a thriving business
iPay88 moves into Philippines market
For more technology news and the latest updates, follow us on Twitter, LinkedIn or Like us on Facebook.
Author Name :
By commenting below, you agree to abide by our ground rules.