Creador poised to reap rewards from CTOS buy

Brahmal (left) says Creador is prepared to hold its investment in CTOS for at least five to 10 years. With him at the briefing are Izzuddin (centre) and Chin.

KUALA LUMPUR: Private equity firm Creador expects its recent acquisition of CTOS Data Systems Sdn Bhd to start bearing fruit in the near future, on the back of its strategic thrusts.

In September, Creador bought a 70% stake in CTOS for RM215mil.

“We would like to grow the business by more than 20% per year in terms of revenue and profit. Growth happens by getting more customers and by offering more products,” said Creador founder and chief executive officer Brahmal Vasudevan at a briefing yesterday.

He said that CTOS roughly brought in RM60mil in revenue.

Brahmal added that Creador was a long-term investor and was prepared to hold its investment in CTOS for at least five to 10 years.

“The goal here is to build the company, and if we build a good business, we will see good returns in the long run. We are in no hurry. If all goes well, we would like to see the possibility of it being listed in Malaysia. And also, more importantly, to use Malaysia as a hub to be perhaps a financial centre or a centre of excellence for credit reporting in the Asean region,” he said.

Creador is leveraging on its investment experience to help propel CTOS to the next level.

One of the first things the private equity firm did after the acquisition was to strengthen the management team at CTOS.

Last month, Creador appointed Tan Sri Izzuddin Dali, the former secretary-general of the treasury at the finance ministry, as chairman of CTOS. Eric Chin, the former chief operating officer of Credit Bureau Malaysia, a government-linked credit reporting agency, has been appointed CEO of CTOS.

Datuk Badri Masri, the former chairman of Astro Malaysia Holdings Bhd, and Datuk Azizan Abd Rahman, the former director-general of the Labuan Financial Services Authority, have also been appointed to the board of directors.

CTOS’ growth strategies include expanding its small and medium-scale enterprise (SME) penetration, increasing its range of products and services, and entering into “new verticals”.

CTOS plans to expand its SME customer base from 3,100 currently to 15,000 by 2020.

The credit agency has also tied up with business analytic software company Fair Isaac Corp (FICO) to launch what Brahmal labelled as a “game changer” for the credit provider industry.

The CTOS-FICO partnership will see a new system that will assign a score to measure the profitability of the repayment of a borrower.

“Moving forward, consumers will do self-checks, where they can check on their credit scores every year or every six months. It would be similar to a medical check-up… the CTOS-FICO score could potentially transform the industry into a consumer’s market,” said Chin.

He expects the new system to be launched in the first quarter of 2015.

CTOS currently manages about 10 million individual records and about two million company credit records.

The company is in talks with Bank Negara to have access to the central credit reference information system database by early 2015.