Paramount Corp CEO: We need to digitise the businesses we want to keep

PETALING JAYA (May 22):  Paramount Corp’s move to digitise its existing operations as well as the exploration of other digital opportunities is a natural progression, CEO Jeffrey Chew (pictured) told The Edge Malaysia in a special report this week.

“We need to digitise the businesses we want to keep. If we cannot digitise them, we would be better off getting rid of them. For future investments, we believe digital is the way forward,” Chew said.

Paramount recently announced plans to acquire a stake in Fundaztic, a peer-to-peer (P2P) lending platform “marking its first steps into digital finance, which may also pave the way for a possible digital banking venture”, wrote the weekly.

Paramount is acquiring a 30% stake in special-purpose vehicle Omegaxis Sdn Bhd, which will own a 63.5% stake in Fundaztic operator Peoplender Sdn Bhd.

The acquisition has been reported as being “in line” with Paramount’s “five-year strategic plan” to identify fresh sources of earnings, “with a focus on the digital space, following the divestment of its education business”.

Back in 2019, Paramount publicised its aim to divest its controlling stake in its K-12 education business to Prestigion Education Sdn Bhd for RM540.5 million.

The group also opted to invest up to RM100 million over the next five years in start-ups “preferably those in the digital space” and in Fundaztic

Chew explained to the business publication that the acquisition of Fundaztic was “timely”, “ahead of Bank Negara Malaysia’s unveiling of the digital banking licensing framework on Dec 31 last year”.

Paramount has reportedly expressed interest in the digital bank license but has yet to make a decision to apply for it.

The Edge’s report said that Paramount has appointed KPMG to conduct a feasibility study on whether “the venture would be viable, profitable and sustainable”.

“Paramount currently fits into two categories. We can provide financial resources, as we are a listed company, and use funds from the divestment of the education business. We also have the education and property experience as our domain knowledge as well as existing customers that we can work with for potential products,” said Chew.

Paramount’s “digital move” is in line with “Chew’s personal vision of how things will be in about three decades”.

“Our digital transformation journey starts with us digitising our processes under the property business. The pandemic has accelerated this — our sales process has gone digital, including signing agreements.

“That’s what we will continue to do, from sales to buying land to designing products and getting approvals from the authorities — everything will eventually be digital over the next five to 10 years,” he added.

But Chew also said that even with its digital effort in fintech and edutech, property will remain its core business for “at least for that time frame”.

As for his vision three decades in the future, Chew is “unsure” whether property will still be Paramount’s “major contributor”.

“We will probably still build houses; people will always need a place to live in. They cannot live in a vacuum in the digital space; they will still need somewhere to physically sleep at night. In that context, we think property will be around for a while,” he said.

Read the full report in this week’s The Edge Malaysia

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