YOMA Strategic : Z59 0%&rsquo s subsidiary will now acquire Telenor&rsquo s 51 per cent stake in Digital Money Myanmar (Wave Money) for US$40 million instead of the US$53 million announced earlier this year.

 

All other material terms from the previous share purchase agreement will remain unchanged, the group said in a bourse filing on Monday (Nov 21).

 

Both parties entered into an amendment agreement for the deal on Nov 18. They had agreed on the new consideration after taking into account their respective long-term business strategies for Myanmar and the economic outlook.

 

&ldquo The company remains confident that the financial services pillar will contribute a significant part of the group&rsquo s business performance over the next three to five years,&rdquo Yoma Strategic said.

 

Mainboard-listed Yoma Strategic, through its subsidiary Yoma MFS Holdings (YMFS), previously agreed to pay US$53 million for the Norwegian telecommunications giant controlling interest in Wave Money, a mobile financial services firm. This included 510,000 ordinary shares and 17.9 million redeemable preference shares.

 

Prior to the US$53 million deal, Yoma proposed to increase its existing shareholding and take a controlling interest in Wave Money via a US$76.5 million deal with Telenor in June 2020. It formed YMFS to restructure the holding of its interest in Wave Money.

 

Yoma later informed shareholders that the Apr 30, 2021 long stop date to complete the proposed acquisition had not been extended, but talks with Telenor over opportunities regarding Wave Money remained.

Myanmar-based conglomerate Yoma Strategic has reported a loss of US$11.3 million for its 2HFY2022 ended Sept 30, from earnings of US$5.96 million recorded in the year earlier. Revenue in the same period was down 5.68% y-o-y to US$40.9 million.

 

For the full year, losses nearly doubled to US$29.3 million, from US$15.7 million of red ink booked for Sept 30 2021.

 

Some of the losses suffered in 2HFY2022 was attributed to some US$4 million in impairment booked for the company&rsquo s property development projects.

 

Its F& B business, meanwhile, generated strong revenue growth of nearly 50% for 2HFY2022 &ndash making this business segment the second largest revenue contributor within Yoma.

 

On the other hand, revenue dropped for other business segments such as financial services, motor leasing and property.

 

Yoma notes in its earnings commentary that the business environment has generally been more stable over the last six months, while some sectors in which it operates &ldquo have actually seen strong growth.&rdquo

 

See also: Metro Holdings reports fall in profits for 1HFY23 due to lockdowns, lower JV profits and rental rebates in China

 

The country' s military took over as the government back in Feb 2021, hurting business sentiment, especially among foreign investors.

 

Yoma says it is &ldquo cautiously optimistic&rdquo about its business prospects for the next 6-12 months and will continue to operate with a focus on maintaining sufficient liquidity whilst reducing overall leverage levels.

 

&ldquo Notwithstanding the strong trends seen in terms of customer demand and sales, inflationary pressures and volatility of the Myanmar Kyat have the potential to pose significant challenges to our financial performance.

 

Yoma &ldquo will continue to operate with a focus on cost discipline and generating positive operating cashflow with a high degree of responsiveness to the overall environment,&rdquo the company adds.