The Edge - Censof to buy 51% of Asian Business Software Solutions Pte Ltd, which develops, sells and markets Mind Your Own Business (MYOB) software, for SG$10 mil
PETALING JAYA: Software and solutions provider Censof Holdings Bhd is buying a controlling stake in its partner Asian Business Software Solutions Pte Ltd (ABSS) for S$10mil (RM28.06mil).
Censof deputy group managing director Tamil Selvan Durairaj said the deal would take about two months to be completed.
For the financial year ended Dec 31, 2014, ABSS’s revenue was at S$8mil while earnings before interest, taxes, depreciation and amortisation stood at S$4mil.
The purchase would be funded equally via its proposed private placement and bank borrowings, he told a press conference yesterday.
The company had announced a private placement to sell up to 10% of its paid up capital or 77.26 million new shares in November last year. The private placement has not been concluded yet.
Censof and ABSS have formed a partnership to distribute and market accounting software products in Malaysia. They made RM8.26mil in sales as of March. The amount contributed 16% towards the coffers of Censof’s wholly-owned subsidiary, Century Software (M) Sdn Bhd.
The tie-up enhanced the group’s client base in the small, medium enterprise (SME) segment.
“We see vast opportunities from the SMEs, which make up more than 90% of all the businesses in Malaysia,” said group managing director Ameer Shaik Mydin.
The implementation of the goods and services tax (GST) this year presented more opportunities for ABSS’ products that target the smaller businesses.
“Most of the big enterprises have installed GST-compliant software but many of the SMEs have not done so,” said Tamil.
ABSS managing director Paul Jennings said sales for the Malaysian market had quadrupled year-on-year due to the demand for GST-related softwares. Top line for ABSS as a group grew 70% in the last one year boosted by the growth here.
Now, Malaysia makes up a-third of its business.
He conceded that some of the sales were one-off but recurring income would come from maintenance and upgrades.
Ameer noted that Censof’s income would be diversified upon the completion of this deal as it had relied heavily on government contracts previously.
Censof would also tap into ABSS’ network to market its products. Censof’s current products focus on tier-one market, which is more comprehensive and specialised while ABSS’ forte is tier three and four markets.
ABSS’ principal markets include Singapore, Malaysia and Hong Kong while Censof’s markets are Malaysia, Indonesia and the United States. For the financial year ended March 31, 2015, Censof’s revenue was RM152mil, from RM80mil in FY14. Its net profit was RM21.6mil compared with RM4.13mil a year earlier.
In November 2013, it bought a 45% stake in Dagang NeXchange Bhd.
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Posted by npznpznpz > 2015-06-26 10:48 | Report Abuse
so many false alarms! @.@