Axiata buys Komli Media’s SEA operations for $11.25m
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Malaysian telecommunications group Axiata Group Bhd has acquired the Southeast Asian operations of Komli Media, a digital advertising firm, for $11.25 million.
In an announcement on Bursa Malaysia, the group said its subsidiary Adknowledge reached an agreement with Komli Asia for the acquisition.
The business being acquired include, Mumbai-headquartered Komli Media’s operations in the Southeast Asia markets – Singapore, Thailand, Vietnam, Philippines, Indonesia, Malaysia – and Hong Kong.
The rationale behind the acquisition, according to Axiata, is that it allows them to “skip past the formative stage of its business plan and scale up its presence and operations in Southeast Asian region.”
It saw Komli’s geographical spread and diversified revenue streams as “a strong strategic fit across digital advertising verticals such as social, video, display and mobile.”
Adknowledge Asia Pacific is an 80 per cent subsidiary of Axiata Digital Advertising, which is a wholly owned by Axiata Digital Services, which in turn is a wholly owned subsidiary of Axiata Group Bhd. Axiata said in its filing that the acquisition “does not have any effect on the issued and paid-up share capital of Axiata and will not have any material effect on the earnings, gearings and net assets of the Axiata Group for the year financial ending December 31, 2015.”
Under the deal, $11.25 million shall be paid in cash. The purchase consideration shall be adjusted with the difference between the target working capital of Komli Asia Group against its working capital which shall be determined based on the aggregate value of Komli Asia Group’s current assets less its current liabilities.
Questions & Answers
Q.What is the primary reason Axiata has given for this acquisition?
What is the primary reason Axiata has given for this acquisition?
Axiata stated the acquisition allows them to bypass the initial setup phase of their business plan. It helps them quickly expand their presence and operations across Southeast Asia.
Q.Which specific markets are included in Komli Media's Southeast Asian operations that Axiata is buying?
Which specific markets are included in Komli Media's Southeast Asian operations that Axiata is buying?
The acquired operations cover Singapore, Thailand, Vietnam, Philippines, Indonesia, Malaysia, and Hong Kong. These are the Southeast Asia markets where Komli Media operates.
Q.How will the purchase price for Komli Media's operations be settled, and are there any adjustments?
How will the purchase price for Komli Media's operations be settled, and are there any adjustments?
The $11.25 million purchase price will be paid entirely in cash. It will be adjusted based on the difference between Komli Asia Group’s target working capital and its actual working capital.
Q.What effect does Axiata expect this acquisition to have on its financial results for the current year?
What effect does Axiata expect this acquisition to have on its financial results for the current year?
Axiata stated the acquisition will not impact its issued and paid-up share capital. It is also not expected to materially affect the group's earnings, gearing, or net assets for the financial year ending December 31, 2015.
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