Great Eastern acquires 22% stake in Axiata’s digital arm Boost for $70m

FILE PHOTO - A security officer guards in front of the Axiata headquarters building in Kuala Lumpur May 28, 2014. REUTERS/Samsul Said

Singapore-based insurer Great Eastern will pay $70 million for a 22% stake in Boost, the Malaysian fintech owned by the Axiata Group.

The deal, announced on Thursday and subject to regulatory approval, comes as the Malaysian telecommunications giant seeks to monetize its e-wallet payment gateway.

Great Eastern, a subsidiary of Singapore’s OCBC Bank, will be acquiring 21.88% in Boost Holdings — valuing the digital financial services business at $320 million.

The remaining stake will be held by Axiata Digital Services, in which Japanese conglomerate Mitsui & Co is a strategic stakeholder.

Malaysia’s largest homegrown e-wallet with over 7.5 million users and 170,000 merchant touchpoints, Boost is also available at over 500,000 merchants across 60 cities in Indonesia.

Speaking to reporters in Kuala Lumpur after witnessing the virtual signing ceremony in Singapore, Axiata Group President & Group CEO Jamaludin Ibrahim said the proceeds from the investment will fund the company’s digital financial services over the next year in Malaysia, Indonesia and Bangladesh.

This marks the third strategic investment secured by Axiata Digital from a well-established financial industry player.

Sumitomo Corp chipped in $20 million in 2018, with Mitsui making its $50 million investment last year.

“The cash injection is a testament in boosting investor confidence through what has been described as the largest foreign investment in the Malaysian fintech sector,” said Jamaludin.

Besides the e-wallet, Boost Holdings will also house Aspirasi — Axiata’s microlending platform.

According to Jamaludin, the platform has approved $20 million worth of microcredits to-date and has the potential to house Malaysia’s first digital bank once it’s approved by regulators.

“We have formed a consortium to apply for the digital bank and we are very positive on the digital bank prospects,” Jamaludin said, adding that Great Eastern is a close insurance partner of Aspirasi with a long-term commercial agreement signed in 2019.

Boost Holdings also includes Trust Axiata Digital Limited, a joint-venture with a local bank in Bangladesh – to launch full-suite mobile financial services in the South Asian country.

“We have recently received regulatory approvals from the Bangladeshi authorities,” Jamaludin said.

This article was first published in Nikkei Asian Review.

Singapore Reporter/s

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Following vacancies can be applied for (only in Singapore).   

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.