Samart Telcoms to Acquire Portalnet for ICT Outsourcing Penetration in Full Scale.
Mr. Watchai Vilailuck, Executive Chairman for Samart Telcoms Plc., disclosed that the company engages in integrated ICT solutions business, having a policy for business expansion and upgrading itself into a fully-integrated IT and software service providers for organizations. The services extend from software development, system installation to services after sales.
Previously, Samart Telcoms has continuously developed and upgraded its capability in providing ICT outsourcing services. In 2006, the company acquired Oasis Consulting Co., Ltd., a SAP system installation service provider for many state enterprises and leading private corporations. Recently, Samart Telcoms has reached a Memorandum of Understanding to acquire business of Portalnet Co., Ltd. (Portalnet) from M-Link Asia Corporation Plc. for 1,552 million baht. Both Samart Telcoms and M-Link Asia Corporation will have further discussion on the deal in details and the result will be forwarded to Samart Telcoms’ shareholders’ meeting for an approval.
Portalnet provides lease of enterprise resource planning (ERP) system for Provincial Electricity Authority (PEA), Thailand’s largest SAP/ERP service project. Portalnet will generate recurring revenue from a lease of 53.20 million baht per month throughout five years of the contract, amounting 3,192 million baht in total. It also has a chance to extend the contract for three more years. In total, this contract will be worth more than 5 billion baht. More than that, Samart Telcoms expects to seize more opportunities with project extension of over 4,000 million baht from the PEA, state organizations and private corporations in the next two years.
“Acquiring Portalnet shares from M-Link Group is regarded as a major strategy and investment to enhance competitiveness and expertise of Samart Telcoms’s ICT solutions business. The company made careful consideration together with its financial, accounting and legal advisors in business opportunities, returns on investment and risks for this investment’s transparency and confidence. This business acquisition will bring about benefits for current and future business operations. Most distinctively Samart Telcoms Plc. will immediately secure more backlog, which will be gradually realized in revenue, of 3,000 million baht in five years once the deal completes. This is to increase its recurring revenue and, thus, be in accordance with the SAMART Group’s goal, aiming to increase its recurring revenue to 50 per cent of total revenue within 2014. More than that, the company will have a chance to extend more revenue from the Provincial Electricity Authority’s extension projects and other related projects. Samart Telcoms will be well equipped with experience and past records in ERP (Enterprise Resource Planning) bidding and service providing projects and that could be its more advantage when it deals with state and private organizations, such as financial institutions and banks, in the future.
In the long run, Samart Telcoms will reap other benefits including knowledge sharing in ERP software and others. Such will strengthen teams of software developers and installation providers to cope with the company’s ICT Outsourcing expansion, enlarging its recurring revenue for its ultimate goal, sustainable growth,” Mr. Watchai said.
Lastly, Mr. Watchai noted “Every decision the company made for investment is grounded on return and business opportunity, which have to be in line with its growth target and vision. I strongly believe that this investment will yield satisfactory returns and become a key to new business opportunities for the SAMART Group of Companies onward.”
Samart Telcoms Plc., a part of SAMART Group of Companies, operates integrated ICT solutions business, which yields handsome revenue to the group continuously. In 2011, Samart Telcoms Plc. post revenue of 10,226 million baht. Its net profit nearly doubled to 791 million baht. The company targets more-than-50 per-cent revenue growth for 2012.