VentureTECH, Japan’s SBI Ventures forms RM75mil fund company

By NST

CYBERJAYA: VentureTECH and Japan's SBI Ventures Malaysia Sdn Bhd have partnered to jointly set up a fund management company with an initial fund size of RM75 million.

The private equity co-investment fund allows Malaysian, specifically, Bumiputera technology-based companies in high value-added emerging industries to tap into the additional source of foreign funds from a global private equity firm.

VentureTECH and SBI Ventures signed a joint venture (JV) investment agreement today to help local, and Bumiputera businesses scale up to their full potential in the high-value-added and emerging industry market segments.

The fund would assist in attracting additional investors to help these companies expand during the post-pandemic recovery period.

Minister in the Prime Minister's Department of Economic Affairs Datuk Seri Mustapa Mohamed said Japanese investors were pioneers in Malaysia in the last 40 to 50 years.

"Post pandemic, bilateral ties between Malaysia and Japan are also important we are on track to become a high-income nation.

"We need to plan for the future. So we have presented the 12th Malaysia Plan in parliament to weather the storm and navigate the country through difficult waters.

"Most importantly, we hope to return to the pre-pandemic level in the second half of 2022 and to recover strongly as possible," he said at the signing ceremony of the

investment JV agreement between VentureTECH and SBI Ventures Malaysia here today.

Mustapa is hopeful the JV agreement would lead Malaysia to a successful journey in becoming a high technology and high-income country.

"We hope this JV enables VentureTECH to raise the level of expertise for Malaysians not only for human capital development but also investments into new emerging areas to address the climate change as Malaysia transitions into a low-carbon economy," he said.

Mustapa said the partnership also would boost private equity investment from the Japanese while transforming Malaysia's micro, small, medium enterprises to be more digitalised while encouraging them to be more competitive.

VentureTECH managing director Dr Norida Abd Rahman said the government-backed impact investment company would continue to support the high growth market and fund local industry players, particularly Bumiputera, with the linkages, network and expertise, fuelling their continued business growth and expansion globally.

"We are proud to be partnering with Japan's SBI Ventures Malaysia as this private equity co-investment fund is a significant step forward towards VentureTECH's vision for creating Malaysian industry leaders.

"It also a hallmark collaboration to diversify our sources of funds for Bumiputera Investment Programme, which has to date resulted in a total investment of more than RM200 million, to nurture those companies in adopting best practices and values, and to accelerate their growth strategies and scale into regional and global champions," she said.

SBI Ventures Malaysia managing director Yoshihiro Ishiwata said the company was grateful to partner with VentureTECH, which has vast investment experiences, a proven track record and precise vision backed by their familiarity with the local investment landscape.

"Malaysia is ranked third among Asean region in terms of per-capita gross domestic product, blessed with young, skilled and abundant labour population, coupled with the low unemployment rate.

"SBI recognises the existence of ample investment opportunities in Malaysia, one of the fastest-growing economies in the Asean region with attractive start-ups," he said.

Yoshihiro said SBI Group seeks to expand its US$5.5 billion worth of private equity portfolio globally and strive to nurture meaningful co-creation throughout this partnership with VentureTECH.

The strategic partnering with Japan's SBI Ventures Malaysia was also crucial in helping Malaysian industries build synergies and collaboration at the regional level while supporting their long-term growth as they strive to continue to scale up and compete in both the Malaysian and global market.

The initial fund would support technology industry leaders with their continued expansion in higher value-added products and services while improving the productivity of the traditional industries through the Fourth Industrial Revolution (IR4.0) and internet of thing (IoT) applications in areas such as agro-based smart farming and digital healthcare.

Additionally, the investments aim to increase the higher number of skilled and highly skilled jobs with higher income to Malaysians, with other socioeconomic benefits.

Since its inception in 2009, VentureTECH has invested and committed to investing in 23 technology industry leaders in the targeted bio-based, emerging, and green industries, with aggregate investee net worth surpassing at least the RM1.2 billion mark.

VentureTECH is a subsidiary of the Malaysian Industry-Government Group for High Technology (MIGHT), established with a developmental mandate on local and Bumiputera industry development.