Hong Seng acquires 51% of eKYC firm Innov8tif for $7M
Malaysian investment holding company Hong Seng Consolidated Berhad has acquired a 51 percent stake in eKYC firm Innov8tif Holdings by purchasing 30.86 million Malaysian ringgits (US$7.2 million) worth of shares, reports The Star.
“The board is of the view that the business of digital identity (ID) assurance and digital ID verification solutions is a fast-growing sector as more organisations are embracing cloud computing and undergoing digital transformations in line with the post-app era where the mobile phone has become the gateway to the majority of interaction points,” said Hong Seng in a filing with Bursa Malaysia.
This is the latest in a chain of announcements involving Innov8tif, which is expanding across the region such as working with ten banks in Cambodia.
The Hong Seng move comes just days after Innov8tif announced it was purchasing the full equity stake of another eKYC provider Xendity, a wholly-owned subsidiary of Green Packet, for RM17.5 million ($4.1 million). The deal was seen as more of a merger than an acquisition, reports The Star.
“The merger would also allow us to expedite our customer ID assurance (CIDA) product roadmap, which is something we have been pitching to our existing customers,” Innov8tif chief innovation officer and co-founder Law Tien Soon told The Star.
Fraud can be reduced, even remotely “by capitalising on multi-factor authentication, including face biometrics and recognised fraud signals.”
Green Packet would appear to have lost a packet on Xendity, which it acquired for RM28.4 million ($6.6 million) in February 2021. After making losses, Green Packet wrote down the carrying value of Xendity to RM13.9 million ($3.23 million), showing it was making a profit of RM3.6 million ($840,000) on the sale.
The deal was originally valued at $10 million in June 2020, but nearly half of the total was dependent on hitting performance targets. Xendity reported net losses in multiple quarters following the sale announcement, according to The Star.