The Zobel family’s latest deal with Japan’s Mitsubishi Corp. may open doors for popular e-wallet platform GCash to get more international investors, possibly through a long-stalled initial public offering (IPO), with the Ayala Group’s venture capital firm now having room to expand outside the Philippines.
In a stock exchange filing on Friday, Ayala Corp. said it would sell half of its shareholding in AC Ventures Holding Corp., which owns 13 percent of fintech unicorn Mynt, to Mitsubishi for P18.4 billion. The deal was first reported by InsiderPH.
Mynt currently owns GCash operator G-Xchange Inc. and microlender Fuse Lending. Mitsubishi is expected to help Mynt grow in the cloud payment space while expanding to overseas markets.
“We believe Mitsubishi can add meaningful value to Mynt, which will allow Mynt to deliver significant value to its over 94 million registered users,” Ayala president and CEO Cezar Consing said in a statement.
Ayala first announced plans in August to engage a “strategic investor” to further boost the success of 20-year-old GCash, which gained traction during the pandemic lockdowns as merchants and customers adopted contactless payment platforms.
The country’s oldest conglomerate injected P22.4 billion in Mynt to increase its shareholding in the Globe Group’s fintech arm. MUFG Bank Ltd., Japan’s largest bank that is also under the Mitsubishi group, likewise infused $393 million into Mynt, representing an 8-percent stake.
High valuation
While the fundraising activities of the Ayala Group have valued GCash at a whopping $5 billion, it has yet to make its much-awaited stock market debut.
Juan Paolo Colet, managing director at investment bank China Bank Capital Corp., told the Inquirer: “The deal reinforces the value of Mynt for its future IPO. With key investors coming in at a valuation of around $5 billion, Mynt is poised for an IPO at a much higher valuation.”
For around a year now, rumors have been circulating that GCash planned to publicly list in the United States.
However, Globe president and CEO Ernest Cu recently told reporters they still preferred a domestic IPO.
But given Mynt’s high valuation, Colet said a dual listing would be best “to get the best of both worlds.”
Eduardo Francisco, president of BDO Capital and Investment Corp., also pointed out that “locals might come in for a small portion only,” with GCash still targeting foreign investors given the fintech firm’s current valuation.
Still, GCash said they had no definite plans yet for an IPO, and that they were well-funded for now.
Colet added the deal with Mitsubishi would enable further growth for AC Ventures.
“The biggest potential of this partnership is the expansion of AC Ventures’ investment universe, in that Mitsubishi can open doors and introduce opportunities for growth outside the Philippines,” he said.