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Indonesian conglomerate buys 3.23% stake in YuuZoo's payment unit for US$5m

BELEAGUERED social media company YuuZoo Networks Group on Thursday said that during the time its shares were suspended from trading, the company had signed an investment agreement for the sale of a 3.23 per cent stake in its fully-owned payment subsidiary, YuuPay Secure, for US$5 million to an Indonesian conglomerate.

This values YuuPay at about US$150 million.

The cash payment has been received in full.

YuuZoo's payment services in 2016 and 2017 generated revenues of more than S$60 million, primarily generated through YuuCollect, a new payment service developed in-house.

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YuuCollect is a proprietary offline payment ecosystem that brings global payment capabilities to underserved consumers who do not have credit or debit cards, YuuZoo said.

Through YuuCollect, a cardless consumer in, say, Indonesia - a country where only 2 per cent of a 265 million population owns a credit card - can buy products from overseas merchants where he or she would not be able to by card because of the know-your-customer (KYC) process, YuuZoo said.

"The YuuCollect ecosystem enables a KYC process to be performed and thereafter allows the consumer to pay offline for online services," it added.

YuuPay is filing a patent application for the YuuCollect platform and ecosystem. The company is growing its global presence through a network of partners doing marketing and sales in various markets. YuuPay plans to base its operations in Thailand, Indonesia, Nigeria and China.

YuuZoo said YuuPay has also signed new agreements with merchants and banks for partnerships that cover online payments, e-wallets and new payment services. 

The Business Times reported two weeks ago that several former employees of YuuZooNow! Pte Ltd in Singapore have made claims against the company for unpaid salaries.

YuuZooNow! is an indirect wholly-owned subsidiary of YuuZoo Networks Group, formerly known as YuuZoo Corporation.

In March this year, YuuZoo closed all its Singapore-based subsidiaries and terminated all its Singapore-based employees as a direct consequence of its trading suspension.

YuuZoo's shares were first suspended in March 2018. Its auditor at the time, RT LLP, said a disclaimer had been issued to YuuZoo, in response to questions posed by the Singapore Exchange (SGX), because the auditor had been "unable to form an opinion due to limitation of scope".

The company added that the SGX had also refused to accept its response, and asked the Commercial Affairs Department to investigate the company.