KUALA LUMPUR (Feb 26): Axiata Group Bhd said it is in talks with a potential new shareholder for its financial technology (fintech) arm Boost Holdings Sdn Bhd.
The deal is still pending regulatory approval, and Axiata is not able to disclose the name of the new investor, group chief executive officer and managing director Vivek Sood said at an earnings briefing on Wednesday.
“We expect by the end of the second quarter of 2025, we should have a new investor in [Boost], which should help us with future funding requirements,” he said.
Companies Commission Malaysia (SSM) data showed that Boost is 77.76% owned by Axiata, while Great Eastern Holdings Ltd’s wholly owned unit Great Eastern Digital Pte Ltd holds a 19.89% stake, and Mitsui & Co Ltd 2.33% equity interest.
Great Eastern, in a Singapore-Exchange filing in September last year, noted that its stake in the fintech company had slipped to 19.898% from 21.875%, following an increase in Boost’s issued and paid-up share capital. Boost’s issued capital stood at RM1.74 billion, with paid-up capital at RM1.59 billion, according to the same SSM record.
In 2020, Axiata sold the 21.875% stake in Boost to Great Eastern for US$70 million — which valued the fintech company at US$320 million.
Boost comprises all-in-one fintech app Boost, micro-financing and micro-insurance provider Aspirasi, regional carrier billing payment player Apigate, and Trust Axiata Digital Ltd — a joint venture with a local bank in Bangladesh.
Boost is also the entity that formed a digital banking joint venture (JV) with RHB Bank Bhd called Boost Bank Bhd. Boost owns a 60% stake in the JV, while RHB Bank holds the remaining 40%.
Boost’s 60%-owned Boost Bank is one of five digital bank licensees in Malaysia. It commenced operations back in June 2024.
In the financial year ended Dec 31, 2024 (FY2024), Boost’s net loss narrowed to RM165.99 million from RM179.24 million in FY2023, with revenue edging up 2.5% to RM155.82 million versus RM152 million previously. The company incurred a start-up loss linked to Boost Bank of RM69.2 million. Non-bank losses narrowed to RM96.8 million, according to Axiata.
Further portfolio optimisation planned
Earlier, when speaking on Axiata’s strategy going forward for its infrastructure (Edotco Group Sdn Bhd and PT Link Net) and digital businesses (Boost and Axiata Digital & Analytics Sdn Bhd), Vivek said the group will remain focused on long-term sustainability. This includes looking at inviting new capital to grow the businesses as well as asset monetisation.
“Just to clarify, it’s not about doing it now. It’s a strategy that will happen over a period of time,” he noted.
On Axiata’s RM4.4 billion capital expenditure guidance for FY2025, Vivek said a “large part” will go towards Indonesia, some for Edotco, as well as the digital telco business in Bangladesh.
“These are our three main markets, Edotco, PT XL Axiata Tbk, as well as Bangladesh. All three are growth markets, and I think it is appropriate for us to continue investing in these markets for growth,” he said.
At Wednesday’s closing, shares of Axiata were five sen or 2.44% higher at RM2.10, valuing the group at RM19.28 billion. —THE EDGE
