Social e-commerce company, YuuZoo Corporation announced on Wednesday that it will buy all the shares of the online games firm, IAHGames. The completed transaction of the two Singapore-based companies consists of one-third cash and two-thirds stock.
Thomas Zilliacus, chairman and chief executive of YuuZoo, said the mutually beneficial alliance makes much commercial sense as they complement each other perfectly.
"The space which YuuZoo is, which is social e-commerce, gaming is a very important part of social e-commerce so there is a very good fit between the business that IAHGames have which we don't," he said.
The mutually beneficial union extends to YuuZoo's ability to tap into IAHGames' strong presence - 35 million members - in Southeast Asia while the gaming firm could develop an industry-first fully integrated social network platform.
Roland Ong, founder and chief executive of IAHGames, said YuuZoo's targeted social e-commerce networks have enhanced user's experience in gaming "as it makes IAHGames the first gaming company with fully integrated social and community networking capability."
Changing gamer profile
The success of YuuZoo's business model has shown that social networking has become the backbone of communication and commerce for young consumers who bypass traditional advertising altogether.
The launch of YuuZoo's online and mobile social network for IAHGames last Tuesday was received positively from approximately 4000 gamers as it is now a one-stop shop with relevant features catered to their needs.
"Wow, it is good that IAHGames has become like that (community site) and is easier for me," said Tan Jia Yeong, Counter-Strike Online gamer.
The brand new IAHGames' website also features the same interface as YuuZoo's website, easing usability for cross platform users.
YuuZoo's expansion plans
In a bid to expand YuuZoo's global presence, this acquisition follows last month's announcement of a S$582 million (US$474,000) reverse takeover agreement of Singapore listed hardware firm, Contel Corporation Limited.
"Combining the forces of the two leading home-grown online and mobile networking and e-commerce companies in Singapore, and having the combined entity listed on the Singapore stock exchange in the near future, will enable us to continue to grow globally, through organic growth as well as additional acquisitions," said Zilliacus.
YuuZoo has about 40 million registered users in 164 countries. It specialises in monetising targeted social networks and creating online payment gateways, including e-wallets, for clients.
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