Censof Holdings Bhd will acquire a 51 per cent stake in Asian Business Software Solutions Pte Ltd for S$(10 million (RM28.06 million) to hold on to its exclusive distribution rights to distribute and market MYOB software products in Malaysia.
Censof group managing director Ameer Shaik Mydin said at the same the same time, the purchase will enable the firm to maximise its earnings and expand its business presence domestically and abroad through Asian Business Software network channels.
"The proposed acquisition will provide Censof additional avenues and opportunities to tap into the growing small and medium scale enterprises (SME) market and management believes that with ABSS, this will provide a channel for Censof to regionalise our clientele.
We believe that this acquisition is the right move for us, as we will still hold on to our distribution rights, but at the same time enable us to maximise our earnings and expand our business presence as a Group," Ameer told reporters at its headquarters here today.
Asian Business Software Solutions Pte Ltd develops, sells and markets software products under the MYOB brand with markets in Singapore, Malaysia and Hong Kong.
Censof is expected to fund the proposed acquisition through a private placement exercise last November which raised RM14 million as well as bank borrowings.
Ameer said “GST implementation turns to be the compliance driver for individuals and Small Medium Enterprises (SMEs) as they find it a requirement to have better financial record keeping.
Thus, we expect higher growth and better years in the future,” said Asian Business Software Managing Director, Paul Alistair Jennings who was also present at the signing ceremony.
While the sales growth of software is seen as a one-off, the recurring income will come from the maintenance and upgrade fee, he added.
The two parties have previously been in a joint venture incorporated in October 2014 to distribute and market MYOB Premier and MYOB Accounting software products within the domestic Malaysia SME market to leverage the introduction of GST.
It was reported that the JV has generated approximately RM8.259 million sales revenue as of March 2015 and contributed about 16 per cent towards Censof’s coffers.