News from the Wire

Japan's GMO Payment Gateway makes strategic investment in Macro Kiosk

Tuesday, August 30, 2016 — 13:21:37 (EDT)

Tokyo, Japan, Aug. 30, 2016 -- GMO Internet Group company GMO Payment Gateway, Inc. (“GMO-PG”) (TSE Stock Code:3769, CEO：Issei Ainoura), one of Japan’s largest payment service providers offering comprehensive payment services and financial services, announced today that GMO-PG has entered into an investment agreement effective August 30, 2016 to acquire a substantial stake in Macro Kiosk Group (”MACROKIOSK”) from Goh Chee Ken, Goh Chee Heng and Goh Chee Seng (being the founders and management of MACROKIOSK, “the Goh Brothers”) for an undisclosed amount of money. GMO-PG will make direct cash investments into MACROKIOSK to further grow its global footprint.

MACROKIOSK (Goh Brothers, Founders) is the leading complete end to end mobile payment, authentication, notification(*2) and enterprise mobility solutions enabler based in Malaysia, and it reaches out to 37 countries into 18 industries with more than 2,000 clients consisting of local and international banks and financial institutions, global aviation companies and low cost carriers, branded and licensed content providers, integrated hotels and resorts, satellite and broadcasting companies and similar other multinational companies in the Asia region. MACROKIOSK is backed by a strong workforce of more than 250 staffs and has a presence in the 12 countries of Malaysia, Singapore, Thailand, Vietnam, Hong Kong, China, Macau, Indonesia, the Philippines, Australia, Taiwan and the United Arab Emirates.

The investment of GMO-PG in MACROKIOSK will benefit and strengthen its continuous expansion of business in Southeast Asia by allowing it to offer overseas assistance to E-Commerce merchants from Japan and payment services to local banks, financial institutions and leading companies in Southeast Asia.

(*1）Base on an in-company investigation of GMO-PG

(*2) Notification: Notifications to a user's mobile device regarding the deposit and withdrawal of internet banking, usage history of e-commerce and other actions.

Background and Overview Malaysia, which has a population of more than 30 million people, had a GDP growth rate in 2015 of 5% (*3) and is forecasted to keep growing, so it has attracted a lot of attention as one of the most booming countries in Southeast Asia. The internet banking penetration rate in Malaysia has been increasing from 10% (2005) to more than 60% (2015 forecast) (*4), and the mobile banking penetration rate has increased from 5% (2011) to 20% (2015) in line with the widespread use of mobile devices such as smartphones, making it the most advanced internet banking using country in Southeast Asia.

Under such circumstances, MACROKIOSK with its complete enterprise mobility solutions in key engagement areas such as interactive, notification, authentication and security services paired with direct connections to leading mobile operators enables secure, scalable and effective implementation of mobile banking solutions with the majority of the leading consumer banking institutions in Malaysia and the surrounding region.

In addition, MACROKIOSK’s mobile payment services enable leading content providers to monetize their digital contents in Southeast Asia via a single direct connection to MACROKIOSK’s mobile payment platform, making MACROKIOSK the single largest mobile payment service enabler in this business field. GMO-PG currently has five local companies in Southeast Asia based in Singapore, Hong Kong, Taiwan, Malaysia and Thailand. Each local company provides the global payment system service “Z.com Payment” to Japanese E-Commerce businesses expanding into the local region and surrounding markets. Simultaneously, GMO Global Payment Fund, a dedicated and focused payment fund, invests both capital in and makes business alliances with promising local payment start-ups and businesses. The two business facets work in synergy, advancing business expansion in the Asia region.

Upon acceleration of further overseas business, GMO-PG is looking into providing payment services to local banks and leading companies in Southeast Asia in addition to overseas assistance of Japan based E-Commerce businesses. Moving forward, both parties aim to deploy a variety of payment services in Southeast Asia with the synergistic effect of combining MACROKIOSK's strong presence in Asia, wide variety of customers and industries, local presence support, human resources and infrastructure in Asia with GMO-PG's experience, knowledge, and financial force which has been cultivated in the payment business for over 20 years in Japan.

Despite the high penetration of mobile device ownership, the ratio of bank account ownership is still less than 50%(*3) in Southeast Asia, where rapid growth of mobile banking is expected. GMO-PG will continue contributing to the spread of mobile banking in Southeast Asia and ensure continuous development of the online payment environment through MACROKIOSK's banking related services. (*3) Source: THE WORLD BANK「World Development Indicators」

“Population, total , GDP growth (annual %) , Account at a financial institution (% age 15+) [ts]”

(*4) Source：FINANCIAL STABILITY AND PAYMENT SYSTEMS REPORT 2009,2014, 2015

Overview of MACRO KIOSK Berhad

MACROKIOSK, Asia’s leading mobile technology enabler, was founded in the year 2000. The company’s breakthrough mobile technology development - the etracker - powers its enterprise mobility solutions and mobile payment services to more than 2,000 clients from 37 countries across 18 industries.

MACROKIOSK has a presence in 12 countries across Asia and the Middle East, with a string of accolades and certifications awarded by internationally-acclaimed establishments and faculties, including the Red Herring Top 100 Global Company Award and ISO27001 ISMS certification.

Merchant’s pickup: MACROKIOSK’s clients are very diverse, ranging from banks and financial institutions to global aviation companies and low cost carriers, branded and licensed content providers, integrated hotels and resorts, satellite and broadcasting companies, and other similar multinational companies in the Asia region.

Name: MACRO KIOSK Berhad Location: The Troika, Tower B, Level 3 19, Persiaran KLCC 50450 Kuala Lumpur, Malaysia Representative: Chief Executive Officer・Goh Chee Ken Business outline: Enterprise Mobility Solutions, Mobile Payment Services Capital stock: 5 million MYR Date of establishment: July. 1, 2000

Overview of GMO Payment Gateway

GMO-PG, established in 1995, is the largest PSP (Payment Service Provider), offering comprehensive payment services to 72,569 merchants (as of June 2016, GMO-PG).

Merchants include not only online services, such as online shops and digital contents, but also subscription based service providers such as NHK (Japan’s largest government broadcast service).

GMO-PG is listed in the first section of the Tokyo Stock Exchange with a total market value of 2.1 Billion USD as of July 29, 2016.

In addition to payment services, GMO-PG provides value adding services, such as web advertising services meant to increase merchant’s net sales, financial services such as ’transaction lending service’ to support merchants’ growth from the funding perspective, and is actively engaged in overseas initiatives such as overseas payment services. The yearly amount processed by GMO-PG exceeds 18 billion USD.

GMO-PG has expanded its overseas business and established local businesses in Singapore, Hong Kong, Taiwan, Malaysia and Thailand in order to provide payment services and for investment purposes. GMO-PG wants to provide both consumers and businesses with payment methods that are convenient and secure to become part of the infrastructure for payment processing in Japan.

GMO-PG will continue to lead in the payment industry through new innovations such as FinTech and contribute to the growth of E-Commerce in Japan.

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Source: Company press release. end of article