Malaysia’s Merchantrade acquires fintech firm Valyou from Telenor

Malaysian digital money services provider and e-money issuer Merchantrade Asia has completed the acquisition of a 100 per cent stake in fintech firm valyou Sdn Bhd from the Norwegian Telenor Group following a competitive bidding exercise.

Merchantrade has obtained all regulatory approvals for the acquisition, the company said in a statement on Thursday.

“Following the completion of the acquisition, the businesses, operations, and staff force of Valyou will be merged with Merchantrade and they will operate as a single entity by end-2020,” Merchantrade managing director Ramasamy K Veeran said.

Valyou is a mobile fintech player, a cross-border digital remittance service provider, and an e-money issuer serving a customer base of over 1 million. It has online and app-based digital channels and physical networks comprising 22 branches, 20 agents, and 1,200 cash-in-cash-out (CICO) merchants, according to the statement.

The acquisition will result in Merchantrade having a combined annual remittance turnover value (based on 2019 figures) of more than RM11 billion ($2.67 billion), which includes domestic outbound and international aggregator transactions, and will bring about an exponential growth in Merchantrade's digital business, the company said.

Together with a combined staff strength of over 1,200 and a network of over 1,700 touchpoints that consist of branches, agent locations, and CICO merchants, the acquisition propels Merchantrade to be Malaysia's largest money services business operator, serving a customer base of over three million.

The acquisition will also consolidate and significantly bump up Merchantrade's share of Malaysia's large migrant-worker customer base. Migrant workers are major users of crossborder remittance services, Ramasamy said.

“We currently work with AXA and MCIS to offer affordable micro-insurance products. The acquisition of Valyou will further strengthen and expand our digital channel and present us with new opportunities to partner with more financial services providers and set the stage for us to go regional” he added.

Merchantrade had, in July this year, further consolidated its position in the Singapore cross-border remittance market by acquiring an additional 21 per cent stake in KLIQ Pte Ltd, a fully-digital, cross-border remittance service provider.

Merchantrade's shareholders include Celcom Axiata and Sumitomo Corporation Japan, according to its website.