ASIA United Bank Corp. (AUB) is set to acquire Singapore-registered remittance firm Pinoy Express PTE Ltd. to add value to the bank’s revenue stream.
In a disclosure to the Philippine Stock Exchange on Tuesday, AUB said its board of directors approved on Friday the buyout of Pinoy Express’ owners. The transaction is expected to be completed by the fourth quarter of the year after regulatory approvals are in place.
“The decision to invest in Pinoy Express PTE. Ltd. is expected to improve AUB’s coverage of the Singapore remittance market,” the disclosure read.
“Pinoy Express PTE. Ltd. is expected to be value accretive to AUB,” it added.
The acquisition price is not yet set, but initial estimates place the transaction value at less than 1 percent of AUB’s book value. The bank said it will pay in cash.
As of end-June, the company’s book value stood at P20.9 billion placing the Pinoy Express transaction at P209 million.
Pinoy Express is a registered remittance company in Singapore and is licensed by the Monetary Authority of Singapore.
It provides a complete range of remittance products and services to migrant workers, principally overseas Filipinos in Singapore.
AUB is not the only company branching out into the remittance business. Aboitiz Equity Ventures Inc. recently acquired a 51-percent stake in Western Union agent PETNET for P1 billion.