Malaysia’s Axiata sells digital ventures portfolio to Pegasus 7 Ventures

Axiata Digital CEO Mohd Khairil Abdullah

Axiata Digital, the digital services arm of telecommunications giant Axiata Group Bhd, has entered into an agreement to sell its digital ventures portfolio at a valuation of $140 million to Singapore investment fund Pegasus 7 Ventures, it said in a statement on Tuesday.

Its portfolio companies include StoreKing, BIMA, FreedomPop, 11street and etobee with operations across Asia, US and Africa. These investments were made with co-investors that include Allianz X, Kinnevik, Millicom, LetterOne, Intel Capital, Atomico, Mangrove Capital Partners, LeapFrog Investments and Kejora Ventures.

Managed by Gordian Capital, Pegasus 7 Ventures will drive the portfolio’s growth led by Gautum Saxena, a seasoned senior investment banker and former head of Asia for telecom and media at Bank of America Merrill Lynch.

“These companies are poised to scale significantly and create value for their stakeholders while continuing to make positive impacts in underserved communities. The addition of these assets to the Pegasus 7 portfolio is synergistic with our thematic focus and will serve as an enabler for our future growth path,” said Saxena.

Meanwhile, its exit from the digital ventures portfolio will enable Axiata Digital to continue to focus on its three core verticals — digital financial services (Boost), digital advertising (ada) and digital platform (Apigate).

“The partners in Pegasus 7 understand our vision, our markets and our portfolio companies which we’ve built to focus on our ecosystem of telco and digital assets. We strongly believe this handover will ensure the assets continue to thrive through access to our customer base, joint marketing and other synergistic activities,” said Axiata Digital CEO Mohd Khairil Abdullah.

Axiata Digital was started in 2013 to help the telco business undergo digital transformation via investments in new age businesses. It has since built a portfolio of 30 companies through minority investments and venture builder models.

The firm also has a seat on the board of Axiata Digital Innovation Fund (ADIF) which is focused on investing in tech startups. ADIF has raised 80 million ringgit ($19.8 million) to date, including investments from state-owned investment arm Johor Corporation (JCorp) and government-owned Malaysia Venture Capital Management Bhd (Mavcap).

Established in 2005, Singapore-based Gordian Capital is an independent and institutionally-focused fund platform specialist. It manages $2.4 billion in private equity, venture capital, real estate, private credit and hedge funds.

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