Great Eastern to buy 21.8% of Boost Holdings


CEO of Axiata Digital Mohd Khairil Abdullah (screen, right) and Group CEO of Great Eastern Khor Hock Seng (screen, left) speaking from Singapore via live streaming during the Axiata Digital and Great Eastern Strategic Investment and Deepen Collaboration in Fintech Services at Axiata Tower today. Also present President and Group CEO of Axiata Group Berhad Tan Sri Jamaludin Ibrahim (seated, middle) - Bernama

KUALA LUMPUR: Singapore-based insurer Great Eastern will buy a 21.875% stake in Boost Holdings Sdn Bhd that will see it becoming an equity partner with Axiata Digital Services Sdn Bhd.

Great Eastern, a subsidiary of OCBC Bank, will invest US$70mil (RM299.355mil) to grow Boost Holdings’ digital financial services business across the region, both companies said at a joint press conference.

“The valuation of Boost Holdings would then translate to US$320mil (RM1.368bil), ” said Axiata Digital’s CEO Mohd Khairil Abdullah.

Axiata president and group CEO Tan Sri Jamaludin Ibrahim said: “As a group that’s committed to creating sustainable business value across all our markets, Axiata has been consistent in our pursuit to aggressively grow our digital ventures.

“I am particularly encouraged that this deal with Great Eastern demonstrates the hard and fast moves we made in the early days to invest in digital businesses that have put us in a sweet spot today to ride the digital wave sweeping much of the nation and the region.”

Axiata Digital, a unit of Bursa Malaysia-listed Axiata Group Bhd, said the equity partnership with Great Eastern marked a significant milestone for the group.

“Great Eastern is a close insurance partner of Aspirasi with a long-term commercial agreement signed in 2019. Today, we are pleased to take the relationship to a new level in the next normal, with Great Eastern as our investor, ” Jamaludin added.

The transaction is expected to be completed in the next few months, subject to relevant regulatory approvals, Axiata Digital said.

Other than its eWallet platform in Malaysia, Boost Holdings also comprises other business units including Boost Indonesia, which has 544,000 merchant touchpoints presently.

Boost Holdings also comprises Aspirasi, a micro-financing and micro-insurance digital financing provider that has over US$20mil in loans disbursed to-date.

Boost Holdings also has Trust Axiata Digital Ltd, which is a joint venture with a local bank in Bangladesh, and Launchpad that brings digital financial services to other Axiata markets.

The company said proceeds from the investment would fund expansion plans for Axiata Digital’s financial services business over the next year in Malaysia and the region, which develop Boost’s ecosystem of merchants and customers, enhance Aspirasi’s credit scoring technology, and potentially housing a digital bank.

“This strategic investment will enable Great Eastern to participate in Axiata’s growing fintech expansion plans in the region. Axiata’s focus on providing financial services for the underserved, unbanked and underinsured customer segment also resonates well with our business strategy.

“By leveraging on Axiata’s network and digital capabilities, and partnering with them, we want to grow our reach into new customer segments to provide for their financial needs and ultimately improve their lives, ” Great Eastern group CEO Khor Hock Seng said.

Meanwhile, Khairil said the plan for it to have a digital bank eventually would entail a different business strategy.

“When that happens, we are looking to establish a consortium to apply for the licence and hopefully to set up the digital bank. We would then need to look for additional sources of funding, ” Khairil said.

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