KUALA LUMPUR (Aug 3): Green Packet Bhd has emerged as a substantial shareholder of loss-making Yen Global Bhd, after acquiring a 22% stake in the company for RM18.15 million or 60 sen per share, which will give it immediate access to the Internet of Things (IoT) business.

In a filing with Bursa Malaysia today, Green Packet said it has acquired 30.25 million shares of the total issued and paid-up capital of Yen Global via an off-market direct business transaction.

The transaction price of 60 sen is 33% lower than current trading price of 89.5 sen as at 2:23pm.

Green Packet said the purchase price of 60 sen was arrived at on a 'willing buyer willing seller' basis, after taking into consideration Yen Global's new business venture in information and communication technology (ICT) business. It will fund the purchase via internal funds.

"The acquisition is in line with the company's direction to make further strategic investment to strengthen the group's ICT equipment business," Green Packet said.

The group also said Atilze Digital Sdn Bhd (formerly VLT Wholesale Sdn Bhd), a wholly-owned subsidiary of Yen Global, has entered into a distributorship agreement with Gemtek Technology Co Ltd to be its distributor to promote, market and sell the products such as LTE, broadband, IoT and other telecommunication products in Southeast Asia.

"Green Packet has identified IoT as one of its immediate growth areas. The acquisition enables the company to have an exposure into the IoT business without the need for a direct involvement and spending in research, development, sales and marketing," it added.

It is worth noting that Taiwan-listed Gemtek, which is a substantial shareholder of Yen Global, has raised its stake in Yen Global to 30.07% last month.

Yen Global posted a wider net loss of RM9.22 million in the nine months ended April 30, 2016 (9MFY16), compared with a net loss of RM8.63 million a year ago, mainly due to an impairment for slow-moving inventories. Revenue fell 28.48% to RM17.15 million from RM23.98 million.

At 12.30pm, shares of Yen Global were traded at 89.5 sen, up 3.5 sen or 4.07%, with 1.66 million shares done, for a market capitalisation of RM123.06 million. Its share price has been on an upward trend since July 13, rising more than 49.16%.

Shares of Green Packet rose 1.5 sen or 6.52% at 24.5 sen, for a market capitalisation of RM169.16 million.