Global investment firm KKR, and China-based internet services provider Tencent Holdings Ltd separately acquired a substantial minority stake worth $175 million in Philippine-based fintech company Voyager Innovations, marking the largest investment to date in a Philippine technology company.
The latest external funding in Voyager is expected to further boost financial inclusion and access to mobile internet for Filipinos. Voyager is the fintech arm of PLDT Inc, the Philippines’ largest telecommunications and digital services provider.
Tencent’s investment is obviously a direct challenge to its mobile payment competitor Alibaba Group Holding whose affiliate Ant Financial Services Group bought in 45 per cent in Globe Telecom’s fintech arm Mynt, last year. PLDT and Globe represent a mobile payment duopoly in the Philippines.
Alibaba and Tencent cover 92 per cent of China’s mobile payments industry. They are the developers of mobile payment platforms Alipay and WeChat Pay, respectively.
Based on the transaction, KKR and Tencent subscribed to newly-issued shares in Voyager as PLDT remains the company’s majority shareholder. The deal is expected to close within the fourth quarter of 2018 even as agreements also contain provisions for Voyager to issue additional shares to other investors which, if it ever happens, would reduce PLDT’s ownership to less than 50 per cent while still remaining as the largest shareholder.
Launched in 2013, Voyager has produced technology platforms that support several digital services such as payment wallet Paymaya, mobile acquiring service Paymaya Business, mobile-based remittance network Smart Padala, digital lending platform Lendr, including a rewards app for free access to the internet and apps in the Philippines called freenet.
“This is a watershed moment not only for Voyager Innovations but also for the Philippines. With this investment by KKR and Tencent, we will trigger an inflection point in digital adoption and financial inclusion in the country,”
said Voyager Innovations president and CEO Orlando Vea.
Terence Lee
Meanwhile, KKR Southeast Asia team director Terence Lee, said:
“Voyager Innovations provides critical digital and financial services to millions of Filipinos looking to join the digital economy for work and play.”
Lee noted they will continue to invest behind online payments leaders in emerging markets as they look forward to leveraging KKR’s industry expertise and resources to help enhance the company’s mission of financial inclusion.
KKR’s investment in Voyager is being funded from KKR Asian Fund III. The investment is KKR’s first private equity investment in the Philippines and is part of the company’s strategy to invest in high-growth markets that the firm believes can benefit from a rapid increase in technology adoption.
Other investments made by KKR in the technology and fintech sectors include Go-Jek (Indonesia’s ride-hailing platform), Suishou Technology (a China-based personal finance management platform) and First Data (a global payment technology and services solutions provider with a presence in 118 countries).
Featured image credit: Freepik
