Shariah PE fund invests in MDT Innovations

SBI Islamic Fund and COPE Private Equity commit RM59m to fuel MDT’s efforts to provide solutions to the entire value chain of IoT

by HABHAJAN SINGH 

A SHARIAH-COMPLIANT private-equity (PE) fund powered by Brunei and Japan plans to inject capital into a Malaysian-based technology company that focuses on the entire value chain of the Internet of Things (IoT).

MDT Innovations Sdn Bhd has received joint investment commitments totalling US$14.25 million (RM58.85 million) from SBI Islamic Fund II (Brunei) Ltd (SBIF II) and Malaysian-based COPE PE.

The new capital injection will fuel and strengthen MDT Innovations’ research and development, enhance its product quality, and expand its business scale, according to a joint statement from the investors.

It added that the move will allow MDT Innovations to maintain its competitive edge in order to become a market leader in the IoT industry and raise its profile as an internationally established player.

The Selangor-based company focuses on IoT value chains ranging from intelligent wireless communications and IoT as a service, to neural network solutions.

The company offers services in domains such as crowd movement, things management and financial technology enablement.

Liew says MdT innovations is uniquely positioned to tap into the huge ioT potential in the asia pacific

MDT Innovations founder/ CEO Liew Choon Lian said the company is uniquely positioned to tap into the huge IoT potential in the Asia Pacific.

As it stands, MDT Innovations said it serves clients across the education, semiconductor, healthcare and security industries in China, Malaysia and Australia.

Founded by Datuk Azam Azman in 2005, COPE — formerly known as CMS Opus PE — is a Malaysia-based PE firm focused on making investments in smalland mid-cap growth companies with a regional presence. COPE has been active in the market since 2006 with assets under management of over RM600 million, according to the statement.

Prior to co-founding the firm in 2005, Azam was a fund manager with Pan Asia Capital Manager and Phileo Asset Management.

Earlier in his career, he worked with HSBC Holdings plc in Hong Kong and Public Bank Bhd as well.

SBIF II is a Shariah-compliant PE fund managed by SBI (B) Sdn Bhd (SBIB), a joint-venture fund management company established by Brunei’s Ministry of Finance and Economy (MoFE) and Tokyo-listed SBI Holdings Inc.

Jeddah-based Islamic Development Bank has also joined forces with MoFE and SBI Holdings to invest in a diverse range of late stage companies across the Asia-Pacific region.

In 2017, for example, SBI Islamic Fund was reported to have earmarked an investment of up to US$100 million for state-owned company Perum Perikanan Indonesia to build fish processing hubs in Aceh and Maumere.

“The world is more connected than ever in the Industry 4.0.

Founded by Azam in 2005, COPE focuses on making investments in small- and mid-cap growth firms with a regional presence

“MDT Innovations is in the right space of IoT,” SBIB CEO Amran Mohamad.

COPE made the investment from COPE Opportunities IV Sdn Bhd, while SBIB made the investment from SBIF II.

In a 2010 statement — when announcing the establishment of the fund management company — SBI said it expects to manage PE funds, including funds that are Shariah-compliant.

“Potential funds will make Shariah-compliant investments into various companies — mainly in Asia — which have sound financials, clear potential for achieving above average growth and profitability, and are led by capable management,” it said.

It added that the fund is in line with Brunei’s objective of diversifying its economy away from the oil and gas sector, while developing its financial services sector and establishing itself as a regional financial hub.