KUALA LUMPUR (Nov 3): Zen Tech International Bhd (KL:ZENTECH) said talks to buy a 30% stake in shariah-compliant payment gateway provider Souqa Fintech Sdn Bhd have fallen through.
The information technology firm said Souqa has terminated the letter of intent (LOI), which initiated negotiations over a potential stake acquisition via a notice dated Oct 28, according to an exchange filing on Monday.
Souqa’s decision came after its preliminary internal evaluations and due-diligence assessments revealed “commercial and structural considerations that were materially adverse to the viability of the acquisition”, Zen Tech said.
“Furthermore, despite constructive and good-faith discussions between the parties, the negotiations did not result in mutually acceptable terms that could form a basis for a definitive agreement,” it added.
As the LOI was non-binding, neither Zen Tech nor Souqa was under any legal obligation in relation to the acquisition.
Zen Tech announced the LOI with Souqa back in July this year.
The prospective deal was backed by the company’s intent to expand its business footprint into the financial technology (fintech) industry.
Notably, another company, Heitech Padu Bhd (KL:HTPADU), had also eyed a stake in Souqa last year.
Heitech Padu pulled out of a subscription agreement to acquire a 30% stake in Souqa for RM16.17 million in October 2024, less than two weeks after entering into the deal, citing a failure to secure board approval for the move.
Shares in Zen Tech ended unchanged at one sen on Monday, valuing the company at RM31.37 million.