KUALA LUMPUR: PUC Bhd has signed a heads of agreement (HOA) for the acquisitions of the entire stake in Alevate Capital Sdn Bhd and Alevate Solutions Sdn Bhd for RM200 million.
The stake is bought from Eatcosys Sdn Bhd, a wholly subsidiary of Incite Innovation Sdn Bhd, and Tham Lih Chung respectively.
In a statement today, PUC said the strategic acquisitions are set to propel its capabilities by adding a fintech vertical that will complement the existing marketing technology (martech) and entertainment technology sectors.
This integration will allow the three divisions to create synergies and enhance PUC's overall service offerings and operational efficiencies, with a profit guarantee of up to RM32 million for the next two financial years.
Alevate Capital, a digital lender licenced by the Ministry of Housing and Local Government, provides money lending services under the Moneylenders Act 1951.
It is highly regarded by small and medium enterprises (SMEs) for its efficient and convenient credit accessibility, transparent financing rates, streamlined onboarding, rapid credit assessments and simplified documentation process.
Alevate Solutions is a technology solutions, operations optimisation and digital transformation solutions provider.
"These acquisitions will significantly enhance PUC's service offerings and operational efficiencies, complementing the existing solutions to clients to provide a holistic and integrated solution.
"This positions PUC as an enhanced integrated technology solutions provider, capable of delivering comprehensive and seamless services to meet the diverse needs of its clients," it said.
Under the HOA, PUC said it will settle the first RM100 million of the purchase consideration through the issuance of 800 million shares at 12.5 sen each.
An additional RM7.5 million in cash will be payable once Alevate Capital and Alevate Solutions achieve a pre-tax profit of RM16 million from July 1, 2024 to June 30, 2025.
The remaining balance will be subject to achieving a further profit guarantee milestone of RM32 million in pre-tax profit from July 1, 2024 to June 30, 2026.
PUC group managing director and chief executive officer Cheong Chia Chou said the acquisitions represent a significant step forward in its strategy to enhance technology capabilities and market presence.
"By integrating Alevate's expertise in fintech, we are poised to deliver comprehensive solutions that cater to the evolving needs for our end users.
"The profit guarantee and expected revenue growth underscore our commitment to creating shareholder value," he added.