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Asdion Reaping Benefit Of Relocating To Malaysia


Kuala Lumpur: The phrase "home is where the heart is" may be the perfect aphorism to describe the decision by Asdion Bhd (AB), which provides integrated software for small and medium-sized enterprises, to relocate in Malaysia.

But in AB's case "home is where the heart and sound business are" may also be appropriate for the company which is reaping benefits from its decision to move its operation to Malaysia from Singapore in 2002.

Its Managing Director, Yap Tai Tee, said that triggered by the Multimedia Super Corridor (MSC) project, AB decided to relocate its headquarters and set up research and development (R&D) facilities in Malaysia.

"Besides, we are all Malaysians, so it's a good chance for us to come back," Yap said in an interview with Bernama.

He said that the MSC provided excellent infrastructures and incentives for information and communications technology (ICT) companies.

AB, which is scheduled for listing on the Mesdaq market of Bursa Malaysia on Jan 13, could also now take advantage of the various fiscal and monetary incentives offered to MSC status companies, after obtaining the status last March, Yap said.

AB's revenue had almost doubled in two years to RM4.138 million for the financial year ended Dec 31, 2003 from RM2.540 million in 2001.

Singapore's market may have contributed more than 50 percent to the company's revenue last year, but for the first six months of current financial year, Malaysia took over the position, contributing 59 percent of AB's RM2.054 million bottomline.

For the Mesdaq listing, the company plans to issue public issue of 12 million new ordinary shares of RM0.10 each at an issue price of RM0.50 per ordinary share payable in full application.

The public issue will comprise one million new ordinary shares of RM0.10 each to be reserved for eligible directors and employees of AB, nine million new ordinary shares of RM0.10 each by way of private placement to identified investors and two million new ordinary shares of RM0.10 each for Malaysian public.

Based on the issue price, AB expects the proceeds to total RM7.347 million, of which RM1.2 million will be utilised as capital expenditure, RM2.2 million for research and development (R&D) expenditure, RM2.747 million for working capital and RM1.2 million listing expenses.

Yap said that with the listing, AB expects to expand and penetrate new markets in the Asia Pacific.

"AB wants to be a recognised and estalished one stop solutions centre and a leading player of advanced integrated solution provider in the Asia Pacific," he said.

He said that according to independent market research report by IDC Market Research (M) Sdn Bhd, Asean application market is expected to reach US$729.9 million (US$1 = RM3.80) in revenue, with compounded annual growth rate (CAGR) of 7.7 percent from 2003 to 2008.

For back-office enterprise applications in which the group is specialised in, the market is expected to increase at a CAGR of 21.2 percent to reach US$2.4 billion in 2008, he said.

"And because the adoption rate in Asia is fairly slow, it provides a very large and untapped market," Yap said.

He added that a service-based economy is very wide and AB is focused on sectors such as hospitality, supply chain management, retail and travel.

AB has already completed phase I of its facilities in Malaysia, which involved infrastructure building and is in the midst of completing phase II, consisting of market research, prototype development and such.

"Full operation will commence in 2005. AB's regional offices in Singapore and China will be our direct sales and marketing office," Yap said.

Besides seeking to position itself as a performance leader in the Asia Pacific market, AB also aims to develop superior and reliable software products to meet the challenging demands in the market place. - Bernama