NCS to acquire majority stake in Yondu through joint venture with Globe Telecom

The joint venture accelerates NCS’s APAC expansion, providing regional and global clients expanded Global Delivery Network and greater access to Digital, Cloud, Data and AI services.

NCS has reached an agreement with Globe Telecom to acquire a majority stake in Globe’s IT arm Yondu in the Philippines. The acquisition enables global clients to have greater access to digital, cloud, data and AI services.

A leading IT solutions provider in the Philippines with over 20 years of expertise, Yondu is a wholly owned subsidiary of Globe, Yondu delivers secure, scalable, and innovative solutions such as custom software development, managed security services, eCommerce solutions, cloud services, and ready-to-use platforms.

With a strong presence in APAC, the joint venture will also see the technology services provider expand its footprint in the Philippines. Currently there are 150 NCS professionals in the Philippines. This figure will now increase to more than 1,200 professionals, establishing NCS as a major technology services player in the country.

The new joint venture entity will be renamed NCS Philippines following the closing of the transaction. It also expedites the expansion of NCS’ Global Delivery Network, combining NCS’ delivery capability and capacity with Yondu’s resources and skills.

Apart from that, NCS will bring its global resources in digital, cloud, data and AI services to augment Yondu’s service offerings. This includes custom software development, eCommerce solutions and cloud platforms.

According to Ng Kuo Pin, CEO of NCS, the joint venture marks a significant milestone in their APAC growth journey as NCS continues to invest to meet the region’s growing demand for technology services, especially AI-led solutions.

“Globe and Yondu’s deep country expertise, coupled with NCS’ technology capabilities, will increase our capacity to further drive business transformation and innovation, especially in the telecommunications sector. It will offer greater value to our global clients, who will benefit from our expanded Global Delivery Network as well as greater access to our digital, cloud, data and AI services,” said Ng.

For Ernest L.Cu, President and CEO of Globe, IT is the bedrock on which industries are built on. As such, he believes IT enables and changes the question from “how do we do use ths” to “what other good things can we do with this?”

“Our vision for Yondu is to be a force for good through effective IT products and services. Partnering with NCS will unlock new global opportunities, enabling Yondu to expand its reach and deliver more impactful IT solutions worldwide,” said Cu.

As part of the transaction, NCS, through its wholly owned subsidiary NCSI Holdings, will acquire a 51% stake in Yondu, which will have a post-transaction enterprise value of PHP 1,868 million (approximately SG$44 million), for a total net consideration of PHP 134 million (approximately SG$3 million), subject to net cash and debt adjustments pursuant to the joint venture agreement.

The PHP 134 million consideration paid by NCS is net of the PHP 818 million (approximately SG$19 million) used by Yondu to acquire the existing NCS’ subsidiary, NCSI Philippines. The transaction will be funded using cash and internal resources. The closing of the transaction is subject to the satisfaction of certain conditions precedent.

As of 31 Dec 2023, the audited net asset value of NCS’ 51% stake in Yondu is PHP 605 million (approximately SG$14 million) and the audited net asset value of NCSI Philippines as of 31 Mar 2024 is PHP 206 million (approximately SG$5 million).