KUALA LUMPUR (June 11): Shares of PUC Bhd (KL:PUC) surged to their highest level in 25 months, after the digital services firm announced the acquisition of a digital money lender and an IT services firm for RM200 million.

PUC closed the day unchanged at six sen after rising as much as 17% or one sen to seven sen in the morning trade on Tuesday.

At six sen, the group has a market capitalisation of RM148.1 million.

The stock saw 64.72 million shares change hands, more than six times higher than its 200-day moving average trading volume of 10 million shares. PUC was also among the top 20 most active counters on Bursa Malaysia.

PUC has rallied 50% from four sen since the beginning of this year. No institutional analysts cover the stock.

On Monday (June 10), PUC announced that it had entered into a head of agreement with Eatcosys Sdn Bhd and Tham Lih Chung to acquire digital money lender Alevate Capital Sdn Bhd and digital transformation solution provider Alevate Solutions Sdn Bhd for a total of RM200 million.

Tham is the director and chief executive officer of Alevate Capital and Alevate Solutions.

Under the agreement, PUC will issue 800 million shares at 12.5 sen each to settle the first RM100 million. If Alevate Capital and Alevate Solutions achieve a profit before taxation (PBT) of RM16 million from July 1, 2024, to June 30, 2025, PUC will pay an additional RM7.5 million in cash. The remaining balance depends on reaching a PBT milestone of RM32 million from July 1, 2024, to June 30, 2026.

The group said the acquisitions would add a fintech (financial technology) vertical that will complement the existing marketing technology and entertainment technology sectors.

“This integration will allow the three divisions to create synergies and enhance PUC’s overall service offerings and operational efficiencies, with a profit guarantee of up to RM32 million over the next two financial years,” the group said.

PUC’s largest shareholder is Lau Pak Lam, co-founder of Cocoaland Bhd, who emerged as a new substantial shareholder after acquiring 232 million units of PUC’s shares via off-market transactions, representing 9.64% of the group’s share base on Jan 26.

Lau’s brother, Liew Fook Meng , also acquired 241.55 million shares on the same day, equivalent to a 9.8% stake.

According to Bloomberg, Lau’s stake in the group has risen to 10.05% as of June 11.

PUC’s other substantial shareholders include GPVF Sdn Bhd, an indirect unit of Genting Plantations Bhd, which holds a 6.59% stake, and Cheong Chia Chou, PUC’s group managing director and chief executive officer, who holds a 6.41% stake.