KKR, Tencent lead $175m investment in PLDT fintech unit

The deal is KKR’s first private equity commitment in the Philippines and has been positioned as part of a plan to target high-growth markets ready to benefit from rapid technology adoption. The firm is investing via its third Asian fund, which closed at $9.3 billion in June last year.

The investors will acquire a significant minority stake in PLDT’s Voyager Innovations business, which operates a number of platforms focused on payments, enterprise services, remittances, lending, and e-commerce rewards. PLDT will initially retain its controlling position in the company although provisions in the deal will allow for future investments to reduce its holding to less than 50%.

“Voyager Innovations provides critical digital and financial services to millions of Filipinos looking to join the digital economy for work and play,” Terence Lee, a director at KKR, said in a statement. “We look forward to leveraging our industry expertise and resources to help enhance the company’s mission of financial inclusion and accelerate its growth at a time when the digital economy is more important than ever.”

Much of the strategy behind the deal focuses on local momentum for financial inclusion through technology, including the growing use of smart phones for online payments, money transfers, and financial services. Voyager CEO Orlando Vea described the investment as a watershed moment for the Philippines that would “trigger an inflection point in digital adoption and financial inclusion in the country.”

Fintech is considered a nascent investment area in the Philippines but strongly supported by an expanding remittance market, local integration of blockchain business models, and the view that the young domestic consumer base is set to demand additional financial services. Meanwhile, enterprise fintech has benefited from a number of government incentives, with recent activity including a $26 million round for lending platform First Circle earlier this week.

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• Topics
• Southeast Asia
• Financials
• Technology
• Philippines
• KKR
• Tencent
• Financial Services