AIMS Group acquires Jaring’s network and customer assets

PETALING JAYA: Home-grown data services provider AIMS Group has won the bid to acquire the country's first Internet service provider (ISP) Jaring Communications Sdn Bhd's (Jaring) data centre and network related customer assets, with an estimated contract value of over RM50 million.
Under the acquisition, AIMS will also attain the rights to Jaring's IPv4 addresses and all of Jaring's existing customers related to data centre, broadband and access, cloud and managed services.
"AIMS was awarded Jaring's assets based on a balance of many factors - in terms of price, product portfolio, experience and skilled resources to fast track the necessary migrations between AIMS and the acquired Jaring operations," AIMS Group COO Mohammad Azman said in a statement yesterday.
Azman added the data centre would also leverage its unique 'carrier neutral' position to ensure smooth migration of services for Jaring's customers.
On May 8, 2015, Jaring was placed into liquidation on High Court order, with KPMG Deal Advisory Sdn Bhd (KPMG) tasked to head the liquidation with the objective of securing the 'best deal' for Jaring and its creditors.
Azman said the demise of Jaring was a reality check on the current unhealthy state of the local data centre market.
"Just over the last few months, we have seen both Patimas and Jaring face liquidation and their customers facing operational risk and being forced to migrate their infrastructure to alternative service providers."
"This actually marks a worrying trend, which can be directly attributed to the high number of players in the market – that is forcing many services providers to move into a price war to attract customers," he said.
He noted that while the price wars may seem as benefiting end customers, it is both the service providers and their customers that will be suffering in the longer run.
"This imbalance caused by oversupply of space in the Malaysian data centre industry and depressed price levels is driving out some of the players, forcing some to shut down their operations," Azman added.
However, he said despite the cut throat situation, he is confident that the group will continue to grow its revenue and market share, and expand its data centre footprint locally, as well as within the region, with the right business model, strategic positioning and partnerships.
"The group's decision to selectively acquire Jaring assets was carefully deliberated upon. We are very confident that AIMS will be able to optimise the purchase of assets from Jaring for our customers, as well as for the betterment of the data centre sector in Malaysia," he concluded.
AIMS' data centre space, which is located at Menara AIMS in Kuala Lumpur, is currently almost fully 100% utilised.
AIMS also operates data centres in Cyberjaya, Johor, Singapore, Penang and Sabah.