DBS Bank relinquishes majority stake in AXS to Tower Capital Asia

Singaporean multinational banking and financial services corporation DBS Bank has revealed that it has signed an agreement with private equity firm Tower Capital Asia to sell 77.8% of its stake in AXS Pte Ltd to it.

The transaction is anticipated to be completed by August this year. Moving forward, Tower Capital Asia plans to assist in expanding AXS’s presence within the Southeast Asian region while DBS will continue to retain a minority stake of 9.9% in AXS.

Tower Capital Asia has stated that no immediate plans to incorporate any material changes to AXS’ operations will be implemented. Customers can continue to utilise the existing services that AXS provides.  Additionally, the transaction is not anticipated to possess a consequential impact on DBS’s earnings or net tangible assets for the financial year ending in December 2023.

“We are very pleased to welcome AXS into our ever-growing portfolio of category-defining companies. The recent explosion in digital payments globally is providing formidable tailwind for AXS, an established player, to seek growth via new business segments and markets,” said Danny Koh, founder and chief executive officer of Tower Capital Asia.

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“We are exhilarated to join hands with Tower Capital Asia. Their investment is more than a nod to what we have built through the years. It is also a strong show of belief in our execution ability and growth potential. We are extremely excited for what the future holds for AXS,” Joey Chang, founder and chief executive officer of AXS added.

Tower Capital Asia aims to reconstruct AXS into a regional cloud-based payment solutions provider and intends to pump in investments into technological innovation and extension of services to provide a seamless payment experience to both merchants and consumers. Additionally, it aims to strengthen predominant business operations to deliver consistent service to clients and users who utilise AXS platforms for payment services.

Additionally, Jeffrey Goh, co-founder of AXS and who previously held the role of chief executive officer of NETS Group will return to AXS.

“It would be truly a homecoming for me, to be able to rejoin AXS which I helped found and whose business I remain deeply passionate about. The digital payments landscape has evolved significantly in the last two decades and I look forward to forging a new collective vision for AXS with my teammates and Tower Capital Asia,” Goh said.

AXS established its operations over 13 years ago in efforts to kickstart an electronic delivery service in Singapore. AXS was a DBS subsidiary in 2006 where, since then, it has extended its digital payments and collections network through over 660 of its operations. This includes the expansion of a slew of online and mobile services.

The news comes just as it was revealed that the disruptions to DBS Bank's digital banking services in May this year were caused by "human error" in coding the programme that was used for system maintenance, according to preliminary investigations by the bank.

This was reported by senior minister Tharman Shanmugaratnam in response to a parliamentary question this week and was targeting disruptions that happened on 5 May this year where DBS customers were unable to access internet and mobile banking, electronic payment, and ATM services.

While DBS fully restored affected services after six and a half hours, MAS has stated publicly that it regards this second disruption within a period of two months as unacceptable, and that DBS had fallen short of MAS’ expectations for banks to deliver reliable services to their customers, said Shanmugaratnam. 

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