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KUALA LUMPUR (July 28): XOX Bhd's largest shareholder Key Alliance Group Bhd is converting its 248.6 million irredeemable convertible preference shares (ICPS) in XOX to an equal number of new ordinary shares in XOX to reaffirm its commitment as a strategic partner to XOX and major shareholder in the company.

In a statement to Bursa Malaysia today, IT solutions provider Key Alliance said its directors wish to increase the company's position in its XOX investment in light of recent developments concerning XOX's new substantial shareholder and its expansion into microfinancing.

According to telecommunication mobile virtual network operator XOX's latest annual report, Key Alliance already owned 99.3 million shares or a 9.09% stake in XOX as at Dec 31, 2019.

XOX's annual report shows that the company's total number of issued shares then was 1.09 billion units.

Key Alliance said in its Bursa filing today it is converting the 248.6 million XOX ICPS to ordinary shares at a conversion price of five sen for each ICPS.

"The board (of Key Alliance) is reaffirming its commitment as a strategic partner to XOX by moving to be the largest shareholder, in order to continue developing a collaborative and complementary platform for the growth of digital economy businesses, as well as cloud computing and archival requirements.

"The financial impact of the conversion can only be determined after the shares are subsequently realised in the market. However, the shares are marked to market on a quarterly basis for reporting purposes. The potential impact judging by the current share price will reflect fair value gain which will affect the quarterly result positively," Key Alliance said.

XOX made crucial announcements today and in recent days.

Today, the company said its latest issued share capital has expanded to 2.06 billion ordinary shares following the conversion of 358.43 million ICPS.

On July 16, XOX said its wholly-owned subsidiary XOX Media Sdn Bhd and Wetek Technology (M) Sdn Bhd (WTSB) had on that day entered into a 40/60 profit sharing partnership to offer micro-financing facilities to XOX’s subscribers and the general public to enhance the adoption of electronic-wallet (e-wallet).

"Pursuant to the agreement, XOX will provide the e-wallet platform to facilitate and enhance the adoption of e-wallet by the subscribers by using the micro-financing facilities from WTSB. Whereas, WTSB will provide the financing of approximately RM1 billion and credit rating algorithm facilities to XOX’s subscribers and (the) general public," XOX said.

On Wednesday (July 22), XOX said Hong Kong national Daniel Tam Ping Kuen had on that day become a substantial shareholder in the company after he acquired 120 million XOX shares or a 7.05% stake in the company via private placement.

On Thursday, (July 23), XOX said Tam raised his stake in XOX to 140 million shares or an 8.22% stake after he acquired another 20,000 shares on the open market.

Today, XOX and Key Alliance ended among Bursa's most-active stocks. At 5pm, top-active stock XOX saw some 918 million shares traded, while Key Alliance registered a volume of about 462 million shares.

XOX's share price closed up 3.5 sen or 14.29% at 28 sen, which gives the company a market capitalisation of RM476.86 million. Key Alliance rose one sen or 11.11% to 10 sen, valuing the group at RM88.47 million.

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