PUC investing in e-commerce platform

PETALING JAYA: PUC Bhd is taking a stake of up to 24% and management control in e-commerce platform 11street Malaysia owner Celcom Planet Sdn Bhd (CPSB), for up to RM90 million.
The deal values CPSB at between RM333 million and RM375 million.
PUC entered into a term sheet with Axiata Group Bhd’s unit Axiata Digital Services Sdn Bhd and SK Planet Global Holdings Pte Ltd, which is a wholly owned subsidiary of SK Planet Co Ltd, as owners of Celcom Planet.
PUC said in a stock exchange filing that it will be investing up to RM90 million in five tranches in CPSB after which its shareholding in the company will increase to 24%. The investment slated to be concluded by end of August 2018 will be funded via internally generated funds, bank borrowings, equity and/or debt fund raising.
The investment for the fifth tranche which amounts to RM50 million will be subject to the approval of the shareholders of PUC and regulatory authority, while the RM40 million under the first four tranches is not subjected to approvals.
“In the event PUC does not succeed in obtaining the approval of shareholders of PUC for the investment of up to RM90 million, PUC will not proceed with the injection of the fifth tranche amount,” its board of directors said. This would leave it with a 12% interest in 11street.
Upon the execution of a definitive agreement and three years thereafter, PUC will have the right to nominate and appoint the CEO and CMO of 11Street Malaysia.
Additionally, under the synergistic collaboration PUC will offer competitive terms to 11Street in terms of marketing especially in digital marketing; payment gateway with PUC’s flagship digital services platform (Presto) being nominated and implemented as the company’s preferred payment platform on all of its e-commerce services and technology needs in terms of e-commerce infrastructure and platform.
PUC’s board of directors said the investment will allow the group to increase potential revenue streams in advertising and media, and financial services segments.
From 2015 to 2017, 11Street reported a more than 300% growth in gross merchandising value (GMV), 160% growth to over 13 million product listings, and 200% increase to 40,000 sellers registered on its platform.
As of Dec 31, 2017, 11Street Malaysia recorded a GMV of RM427 million for financial ended Dec 31 2017, and total monthly unique visitors of 13.5 million for the month of December 2017.
Apart from advertising and media and financial services segments, PUC is involved in biometrics and renewable energy.
PUC’s shares fell 1.85% to 26.5 sen with 49.01 million shares done.