NexG Assesses Datasonic Technologies Value At RM7.5 Bln
KUALA LUMPUR, Aug 20 (Bernama) -- NexG Bhd says its wholly owned subsidiary Datasonic Technologies Sdn Bhd (DTSB), which is the provider of the MyKad national identity card, is currently valued at RM7.5 billion following the government's request for an indicative price.
NexG, which is one of the most prominent security-related integrated technology solutions providers, said in a statement that the request for an indicative price is for a possible acquisition of DTSB.
"For context, DTSB makes up the core operating business of NexG and is the main revenue and earnings contributor of the group. The disposal of this business effectively means NexG will no longer have a core business.
NexG said the board acknowledges the government’s request and will give the request due and proper consideration.
"At this stage, no decision has been made by the board to proceed with any transaction, nor has any agreement been reached with the government.
“Should the matter progress beyond this preliminary stage, the board wishes to emphasise that its consideration of any potential transaction would be guided by the following principles -- any potential transaction would need to be at a fair value that properly reflects the assessed value of DTSB; all shareholders of the company must be treated equally and on the same terms; and the security and continuity of the national identity capability operated by DTSB must be preserved,” said NexG.
The group said the board would like to state that the RM7.5 billion sum-of-parts valuation for DTSB is a preliminary internal assessment not an independent valuation, an agreed price or a firm offer.
The board is cognisant that this assessed value of DTSB is significantly above the current market capitalisation of NexG, the listed holding company, of about RM1.04 billion.
Why DTSB is Worth RM7.5 billion
NexG said that as Malaysia explores the modernisation of voting, including biometric voter verification and electronic voting, a trusted, biometrically verifiable national identity is exactly the kind of foundation such initiatives would require.
Therefore, a change in ownership of DTSB is a matter of great implications, no matter who the new owner is, it said.
"We wish to emphasise that DTSB is not a single product or contract. It is an integrated, sovereign, end-to-end national identity business that has served the nation since 1999, as a supplier of Malaysia's identity and secure documents.
It is the provider of the MyKad national identity card and, since 2012, the vendor for Malaysia's International Civil Aviation Organisation (ICAO) compliant-passport.
It presently holds the mandates for the new-structure MyKad, MyTentera and MyPOCA identity cards, with multi-year supply commitments.
NexG said very few operators anywhere in the world provide such end-to-end capability, from secure document design and manufacture through to the biometric verification that authenticates the holder.
"DTSB owns valuable intellectual property, including its patent-pending biometric QR citizen verification flow, with a liveness check that guards against impersonation, forged documents, spoofing, and copyright applications for the MyKad and passport designs.
Its identity technology also spans ICAO-compliant e-passports and biometric systems using multimodal biometrics and facial recognition.
"For the current national identity programme, DTSB has committed investments of about RM1.9 billion in people, equipment, system upgrades and two manufacturing plants in Petaling Jaya and Meru (Klang),” said the company.
Apart from that, the group said DTSB is developing a modular digital ecosystem or a “SuperApp” that brings together a ready-for-commercialisation biometric QR identity verification platform for banks, merchants and other institutions, alongside a purpose-built government e-wallet for targeted subsidies and assistance programmes.
It said the next-generation MyKad extends beyond a physical identity card through a proprietary encrypted QR identity function, enabling the cardholder's identity to be securely verified using biometric facial verification and liveness detection.
Built around this trusted identity layer is SALUR, a purpose-built government digital wallet and payment ecosystem, which enables the government to distribute targeted subsidies, assistance and other benefits digitally, with the ability to define who is eligible, what the funds may be used for, where they may be spent, and to trace and reconcile how government funds are ultimately utilised, said NexG.
More importantly, SALUR can be provided to the government as its dedicated wallet infrastructure at zero platform acquisition cost.
“All these combined characteristics underpin the board's assessment of DTSB's value at about RM7.5 billion,” it said.
Under the Main Market listing requirement, a disposal of NexG’s core business would, among other things, require the approval of shareholders at an extraordinary general meeting, and the appointment of an independent adviser to advise shareholders.
The board will comply with all applicable requirements.
It will also provide the indicative assessment as requested and will make further announcements as and when there are material developments.
-- BERNAMA