Weyland Tech Signs Definitive Agreement to Acquire Push Interactive’s US eCommerce Platform for $25 Million
Weyland Tech, Inc. , a leading global Platform-as-a-Service (PaaS) provider of mCommerce and fintech business enablement solutions, has signed a definitive agreement to acquire the assets and operations of privately-held Push Holdings, a subsidiary of ConversionPoint Technologies (CPT), for $25 million in an all-stock transaction.
This definitive agreement follows the earlier announcement of Weyland’s plans to acquire Push in order to support the launch of its CreateApp mCommerce and mobile fintech solutions in North America, as well as to introduce additional eCommerce products and services globally.
Consideration for the transaction is comprised of 35,714,285 shares of Weyland Tech common stock priced at a premium to the current market valuation. Of the total consideration, 28,571,428 shares are payable to CPT upon closing, with the balance of 7,142,857 shares payable subject to the achievement of certain performance milestones and other criteria. The acquisition includes approximately $1.5 million in cash on Push’s balance sheet to support the transition and integration, as well as the launch of CreateApp in the US.
Weyland expects to close the acquisition in early January and that it will be accretive to earnings in the first full quarter as part of Weyland. Push’s additional revenue streams, synergistic product offerings, and support of the CreateApp US market launch are expected to help drive more than 100% top-line growth in 2020. Weyland recently reported trailing 12-month recurring revenues of more than $32 million.
The acquired assets and operations of Push Holdings are primarily comprised of the eCommerce technology company, Push Interactive, with 20 full-time employees headquartered in Minneapolis, Minn. The Push Interactive direct-to-consumer eCommerce platform provides an end-to-end solution for SMBs and major brands to dramatically increase online revenue while lowering the cost of customer acquisition and order fulfillment.
“We continue to believe Push will be a highly transformative acquisition on multiple levels, with this driving strong revenue growth and market expansion,” said Brent Suen, CEO of Weyland Tech. “Push’s eCommerce platform is highly synergistic to our existing mCommerce technologies, particularly with CreateApp and AtozGo. Our respective offerings are both mobile-friendly and can provide complementary products and services, while our technology and revenue models can be seamlessly integrated into a single platform.”
The integration of the Weyland and Push platforms is expected to significantly enhance the value proposition for existing and prospective customers. Initial cross-selling opportunities include using CreateApp and AtozPay to support US-based projects and campaigns for Push’s current enterprise customers.
“We recognized tremendous synergies in technology and in our corporate missions right from the start,” commented Haig Newton, co-founder, CEO and president of Push Holdings. “We believe that together we will be able to better help businesses and brands around the world reach more customers, increase their sales, and promote their products and services in an easier, more affordable and highly efficient way.”
Push will provide Weyland a well-established beachhead in North America, allowing it to attract new users to CreateApp and AtozPay quickly and cost-efficiently. This includes greatly reduced customer acquisition costs Weyland could not have achieved on its own. Previously, US customer acquisition costs for CreateApp were estimated at $2-$3 per dollar generated, making market entry economically unfeasible. By leveraging Push’s highly effective marketing technology and operational resources, US customer acquisition cost is expected to be as little as $0.30 on the dollar.
“What we find so amazing about CreateApp is that it requires literally no technical understanding or skills in app design for anyone to build a full-featured custom app in less than two hours,” noted Push Interactive’s chief technology officer, Tom Furukawa. “It’s a Shopify-like solution for mobile that enables businesses and brands to establish a mCommerce presence in an intuitive, do-it-yourself fashion. Layering on our Push platform, CreateApp users gain a fully end-to-end mCommerce solution supported by our team of expert digital media marketers that can enhance their visibility, customer traffic and ultimately conversions.”
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As part of a public company, Weyland’s new Push subsidiary will gain easier access to growth capital and be better able to attract additional employee talent. Push can also leverage the cost efficiencies and diverse capabilities of Weyland’s existing 200-person technology and software development team in Jaipur, India, while Weyland gains technical and software development expertise from Push.
Weyland plans to launch CreateApp in the US during the first quarter of 2020. The North American market is expected to support a higher price point for subscription fees as compared to the company’s current market in Southeast Asia. A comparative revenue model of a US industry peer supports 96,000 users at $300 each per month. This is several times higher than the current CreateApp subscription model for Southeast Asia at only $12-$80 per month, depending on optional features implemented.
“Our initial work with Push to introduce CreateApp in the US led to this strategic acquisition, so we have already made strong progress in this regard,” added Suen. “eCommerce is becoming increasingly mobile in the US, creating a huge new market opportunity for CreateApp and AtozPay.”
Weyland’s post-acquisition revenue model anticipates that US CreateApp subscription revenues alone could exceed $5 million by end of 2020. This would be in addition to potential new Push offerings adopted by Weyland’s existing international SMB customer base, as well as new AtozPay eWallet and mobile pay integrations in the US.