SINGAPORE - Information technology firm DeClout is proposing to buy internet service provider (ISP) assets and business in Singapore and Thailand from PacNet Internet Singapore for US$4.4 million in total.
In a statement Sunday, Singapore-listed DeClout said the move would expand the company's regional reach throughout South-east Asia, and boost its infrastructure and internet network connectivity services.
DeClout, with businesses in IT infrastructure and cloud computing, is listed on the Singapore Exchange's second board Catalist and said the deal would also allow it to cross-sell the group's different ITand telecommunications products to a wider customer base.
PacNet is a subsidiary of Telstra Corporation, Australia's leading telecommunications
Under the proposed deal, DeClout's unit, Acclivis Technologies and Solutions("Acclivis") would, through its subsidiary, OSINet Communications, buy assets including Pacific Internet trade marks in Singapore.
At the same time, DeClout's indirect subsidiary, Acclivis Technologies (Thailand), will acquire the entire share capital of Pacnet Internet Thailand for US$2.1 million.
Both the Singapore and Thailand businesses are focused on providing ISP services to small and medium sized businesses.
Completion of the Singapore Transaction is subject to regulatory approval from
the Infocomm Development Authority of Singapore.
Upon the completion of the planned deal, the acquired assets would be merged with Acclivis' existing ISP business, OSINet, and together, be rebranded as Pacific Internet, allowing Acclivis to broaden its offerings and achieve further economies of scale in the ISP segment.
The deal is also expected to boost earnings and to bring in more than 3,000 customers. Pacnet Internet Singapore and Pacnet Internet Thailand posted about S$20 million in combined revenue for the financial year ended Dec 31, last year.
Mr Marcus Cheng, chief executive of Acclivis said: "The proposed acquisition enables
Acclivis to offer a one-stop regional ICT service to our enterprise customers and
give them more choices in deploying the best latency and network through our
enhanced internet connectivity services in the region."
Mr Cheng added: "The ISP segment of our business has been a strong growth area,
and this acquisition will further enhance our recurring revenue stream. Our
enlarged presence and capabilities will also help Acclivis expand into new
markets, further driving our top-line growth and profitability."
The deal would also allow Acclivis to become a licensed operator in Thailand with the relevant ISP and telecommunications business licences to expand its cloud business there.
The group believes that these licences would enable Acclivis and other DeClout
business units to offer new services in Thailand in the business-to-business and
business-to-consumer space and beyond.
Mr Vesmond Wong, chairman and group chief executiveof DeClout said: "This deal is
another milestone for us as it will allow DeClout to extend its regional presence in
South-east Asia and create more opportunities to upsell and cross-sell our cloud,
technology, managed services and other telecommunications products of the
group to a broader customer base. Given the customer reach of the two
businesses, we are optimistic of their positive contributions to the Group's financial
performance in the financial year ending Dec 31, 2016."