Axiata Digital Services Sdn. Bhd. (AD), the digital services arm of Axiata Group Berhad (Axiata” or “the Group), announced a strategic minority investment by Mitsui & Co., Ltd. (Mitsui).
The investment establishes a pre-money enterprise value of USD 500 million for the core digital businesses of AD which include Boost, a leading e-wallet service in Malaysia with a presence in Indonesia, ada (analytics.data.advertising), the largest independent digital agency in the region, and Apigate, an emerging global API platform provider.
Mitsui will become a strategic shareholder and business partner at AD’s core business verticals. The funds raised will be earmarked to fuel the next phase of growth for AD’s core businesses.
AD was initially established at the end of 2013 to support the increasingly digital lifestyle of Axiata consumers and grew to a portfolio of 30 brands. By 2017, AD began to focus on being an operator of strategic digital businesses.
In digital financial services (Boost), AD focused on e-wallets, remittance, micro-insurance and micro-lending. In advertising (ada), AD combines the best of data science, technology, creative and content, to disrupt marketing for brands and businesses across Asia. On the platform side (Apigate), AD’s open source marketplace of scalable APIs helps connect OTTs to a world-class ecosystem and 3.5 billion customers of global MNOs through one secure, seamless platform.
“Axiata Digital is a powerful digital platform engaged in digital financial services, API, and digital marketing” said Masahiro Moriyasu, Managing Officer, COO of the IT & Communications Business Unit at Mitsui. “As an expansion of our strategic partnership with Axiata, we are very excited about this investment in Axiata Digital which follows our earlier investment in Smart Axiata in Cambodia, the country’s largest mobile telecom operator. By enhancing close collaboration between Axiata Digital and Mitsui, we are confident that we can support our partners and customers to create new value and accelerate their digital transformation in various industries.”
“Our shift to be more focused in the three vertical areas has seen our businesses grow at a strong pace in 2018. With the investment from a partner like Mitsui, we hope to further accelerate these businesses while still being focused on distinct financial innovations for consumers at the bottom of the pyramid, marrying data and creative content for brands as well as enabling rapid growth and monetisation for partners on our platform.” said Mohd Khairil Abdullah, CEO, Axiata Digital.
Recently, Axiata Digital also announced it signed up to transfer the rest of its portfolio, called Digital Venture (DV) assets, to an international investment fund (Pegasus 7 Ventures Pte Ltd) managed by Gordian Capital at a valuation of USD140 million. Combined with the pre-money equity valuation of AD’s core digital businesses in view of Mitsui’s investment, the entire portfolio of AD is therefore valued at USD 640 million.
“We are very pleased with the investment by Mitsui and Gordian Capital as it marks a validation point for Axiata’s digital and internet ventures journey which began five years ago. The pre-money valuation of our 3 core digital businesses (Boost, ada, Apigate) and DV assets represents a 2.6x multiple against the cumulative digital investment of USD 244 million which we had made since the inception of Axiata Digital. Coupled with the growing success of Boost, ada and Apigate in their respective areas, we believe that we are now one step closer to creating the very first “Unicorn” in Malaysia.” said Tan Sri Jamaludin Ibrahim, President and Group CEO, Axiata Group Berhad.