Smartluy Plc, a subsidiary of a Malaysian-owned Smart Axiata Co Ltd, a leading telecommunications service provider in Cambodia, and cashless payment platform Pi Pay Plc on Monday have completed their merger after receiving approval from the National Bank of Cambodia (NBC) and the Ministry of Commerce.
Currently, Smart Axiata serves eight million subscribers under its ‘Smart’ brand, and is part of Malaysian telecommunications conglomerate Axiata Group Bhd. Its network coverage is 99 per cent of the Kingdom’s population.
Axiata Group said in a filing to Malaysia’s stock exchange Bursa Malaysia on Wednesday that it had received a notice from the NBC and the ministry of the successful application for the merger when the legal existence of SmartLuy terminated and was continued with Pi Pay as a single entity.
It said: “The cessation of SmartLuy will not have any material effect on the earnings or net assets of the Axiata Group for the financial year ending December 31, 2020.
“The cost of investment of SmartLuy is $2 million. None of the directors or major shareholders of Axiata or persons connected with them have any interest, direct or indirect, in the said cessation.”
Earlier this year, both companies opted for a voluntary disclosure of the merger that once completed, is expected to “lead as well as shape the Kingdom’s promising payment ecosystem”.
A joint statement said: “NBC’s swift approval process is certainly a big boost towards further cementing Pi Pay’s leadership position in the digital payment landscape in Cambodia post-merger completion.”
SmartLuy employees will join the Pi Pay team at the completion of the merger, while SmartLuy customers, agents as well as vendors will migrate to Pi Pay, the statement said.
Existing SmartLuy customers will be able to transfer their wallet balances to new Pi Pay accounts before the integration phase following the completion of the merger, it said.
Last month, Pi Pay CEO Tomas Pokorny said the merger will provide Pi Pay with an array of new opportunities and resources to leverage on.
“With Smart, Pi Pay will be better equipped to support the government’s agenda of reducing barriers to digitalisation and widen digital payments adoption among consumers as well as merchants, including among small retail businesses,” he said.
Smart Axiata CEO Thomas Hundt said then: “This positive development has been envisioned in line with the overarching strategy of strengthening our digital business portfolio while introducing various innovative, lifestyle and entertainment value propositions for our millions of customers.
On the Bursa Malaysia, Axiata Group’s share price fell six sen (1.4 US cents) or 1.76 per cent to close at 3.35 ringgit ($0.78) on Thursday for a market capitalisation of 30.72 billion ringgit, with 1.32 million shares traded.
Launched in 2017, Pi Pay has quickly expanded its user base to nearly 300,000, logging more than $350 million in transaction value and boasting 4,500 merchant locations across the Kingdom.