GDex, Teak Ventures buy into software solution company

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KUALA LUMPUR (Nov 18): GD Express Carrier Bhd (GDex) and Teak Ventures Sdn Bhd signed a conditional share sale agreement to buy 30% of Penang-based Web Bytes Sdn Bhd, a company specialising in retail management solution software, for RM5.5 million.

The purchase consideration was arrived at on a "willing-buyer willing-seller" basis after considering and looking at the earnings potential of Web Bytes, GDex said in its statement to Bursa Malaysia today.

The proposed acquisition will be satisfied entirely in cash, which will be financed by GDex's internal funds.

Web Bytes is a software solution development company based in Penang, specialising in the provision of retail management solution on the cloud to retail enterprises. The product is delivered under the flagship product brand called Xilnex.

At the moment, Xilnex offers secure, reliable and cost effective retail business software to micro-businesses, SOHO (Small Office, Home Office), small and medium chain retailers and also franchise retailers. It had also obtained its Multimedia Super Corridor (MSC) status from Multimedia Development Corporation Sdn Bhd (MDEC) in 2012.

Meanwhile, Teak Ventures, which is principally engaged in venture capital funds, is managed by Teak Capital Sdn Bhd in partnership with the Malaysia Venture Capital Management Bhd (MAVCAP) under its Outsource Partners' Programme. Teak Ventures has supported the growth of Web Bytes since 2013.

In the statement, GDex said the customer-centric problem solving business model bodes well with its business philosophy.

"We acknowledge that technology is vital for our competitiveness in this digital era. We will harness the synergy with Web Bytes to explore innovative solutions and provide better services to its customers," GDex said.

At the same time, GDex and Web Bytes will explore other synergies including co-developing solutions to strengthen the operations of both companies.

Although the contribution to GDex's consolidated financial statement is minimal at this stage, its management is positive the strategic investment will yield a positive outcome in the near future, it said.

"The [transaction] will not have any effect on the issued and paid-up share capital and substantial shareholders' shareholdings of the company, and will not pose any material impact on the net assets, gearing, earnings and earnings per share of the group for the financial year ending June 30, 2017," it added.

GDex closed unchanged at RM1.68, giving it a market value of RM2.32 billion.