BEIJING and HONG KONG, May 5, 2015 /PRNewswire/ -- Hong Kong Listed Chinese IT software and service provider Chinasoft International (00354.HK) recently announced that it has issued 100 million new shares to three institutional investors with strong backgrounds. BOCOM International Holdings Company Limited ("BOCOM International") will subscribe to 50 million shares, The People's Insurance Company (Group) of China Limited ("PICC") and China Life Franklin Asset Management Co. Limited ("China Life") will each subscribe to 25 million shares.
Through this placement, the Company will raise close to HK $370 million and use it to develop and expand its Internet finance related businesses, promote and manage the Jointforce platform, acquire oversea companies with large data volume processing capabilities in the finance industry, and expand and build enterprise cloud service channels and enterprise cloud platform. In addition, Chinaosft entered into a strategic cooperation agreement with BOCOM International and will have the full support from BOCOM International in funding, businesses, and the capital market.
Strong Shareholder Background
BOCOM International is a wholly owned subsidiary of BOCOM, and is well recognized and influential in the market. PICC and China Life are two large scale insurance funds that are known to invest steadily in the secondary market.
The subscription of the three said institutional investors in this placement shows Chinasoft's solid fundamentals and growth potential in the future has been approved by long term investors. The Company is expected to grow even more rapidly in the future.
Implications from this Strategic Partnership
According to the Chinasoft and BOCOM International agreement, both parties will engage in cooperation in multiple levels, with the focus in Internet finance and securities. The main implications are as follow:
1) Strengthen Partnership with BOCOM through BOCOM International's Investment
The strategic partnership with BOCOM International will further strengthen the partnership with BOCOM. Chinasoft is BOCOM's largest IT services provider, with revenue of RMB 100 million last year. Under the new circumstances and opportunities, Chinasoft expects the revenue from BOCOM will increase significantly. In addition, BOCOM International and Chinasoft will become partners in Internet finance and large data volume processing in the finance industry, leveraged on BOCOM's influence in the finance industry to reach out to potential customers. This partnership will also allow Chinasoft to gain a more thorough support from the capital market in the future.
2) Introduce Financing Options on the Jointforce platform to Create "IT Supply Chain Financing" and Realize Internet Finance Services Revenue Through BOCOM International's Partnership
Chinasoft's Jointforce platform has grown rapidly since its public beta launch. Currently, there are over 30,000 registered engineers and 500 registered enterprises who can potentially have financing needs. BOCOM International will help the Company design Internet finance products that will help the suppliers and buyers achieve their financing needs on the Jointforce platform. Through this, Chinasoft can charge service fees to realize Internet finance revenue under the Jointforce ecosystem. Through the Jointforce financing plans and designs, Chinasoft will have a finance element in its business, allowing it to expand in different directions in the Internet finance industry.
Through this cooperation, Jointforce platform will be able to introduce financing options. Once the users of the platform have more capital, they will be able to expand their businesses quicker and increasing customer stickiness to the platform. In addition, this will help attract more enterprises to come online and improve the platform's activities. Most importantly, prior to the financing options, the platform helped the corporations to customize, post, divide, integrate, and test projects (IT supply chain management), once the financing option is introduced, Chinasoft's Jointforce platform is able to provide a new ecosystem of "IT supply chain financing". This will increase the platform's business and capital market valuations.
3) Leverage on BOCOM International and Break Into the Internet Securities Business
Chinasoft will also leverage on BOCOM International's existing online securities platform to provide advanced technological support to help BOCOM International create a closed loop system of opening accounts, putting money in accounts, giving information, consulting, paying, and using big data to help accurately identify target clients' needs and improve customer relations. This will help Chinasoft to expand into the Internet securities market and help the Company to achieve additional revenue growth. In addition, with the "Internet +" policy and a more open channel of investments between China and Hong Kong, the securities industry will have more demands to build big data platforms. The partnership with BOCOM International will serve as an example to help Chinasoft reach out to more potential clients in the future.
This strategic partnership with BOCOM International has a big implication to Chinasoft. The Company will not only have more businesses and business models, but also will build a new Internet ecosystem that will help speed up its transformation. The Company believes this strategic partnership will help Chinasoft realizes business developments and allow its capital market valuation to soar.
About ChinaSoft International Limited, "CSI" (354.HK)
Founded in 2000, ChinaSoft International Limited is a listed company in the Hong Kong Stock Exchange with its code of 354.HK. It is a large Chinese comprehensive software and information services provider, ranging from end to end services of consulting, solution, outsourcing and talent training. It serves clients including government, manufacturing, finance, telecommunication, high-tech, transportation as well as energy. It provides global services to over 100 multinational companies with more than 25,000 employees located worldwide based in 39 cities including mainland China, Hong Kong, Princeton, Seattle, London, Tokyo and etc. For more information, please visit www.chinasofti.com.
