Iris-Global Blue to bid for GST refund business

by **Cals** Tue 22 Apr 2014, 19:47

Business & Markets 2014

Written by Madiha Fuad of theedgemalaysia.com

Tuesday, 22 April 2014 10:23

KUALA LUMPUR: Iris Corp Bhd has teamed up with Swiss-based Global Blue SA to bid for the Malaysian government’s tender to offer GST refund services to foreign travellers.

In a filing with Bursa Malaysia yesterday, Iris said it had entered into an agreement with Global Blue on Dec 9 last year to form a joint venture (JV) company to participate in the government tender.

It was previously reported in The Edge weekly that bidders have tied up with an international group, as the tender requires a company to have at least five years’ experience in the tourist refund business. A majority stake of 51% in the JV company must also be held by the local party.

The JV company will see Iris holding a 51% stake with Global Blue holding the remaining 49%. “The JV is to enable the group to expand its business in the operations of the GST Refund Services to foreign travellers and any ancillary or related activities of any kind.

Global Blue is a corporation that has developed and acquired techniques, proprietary information, financing and operation of a business for the refund of GST.

“The parties agree that in recognition of Global Blue’s expertise in operating and managing the GST business, the MD [managing director] shall be appointed by the board from one of the directors nominated by Global Blue,” said Iris, noting that the MD will be responsible for the day-to-day operations of the JV company.

Iris pointed out that in the event the tender for the tourist refund scheme is not awarded to the JV company, the agreement will be terminated and deemed null and void. Each party will also bear its own costs and expenses incurred prior to such a termination.

It noted that there is no assurance that the anticipated benefits from the agreement will be realised immediately.

The JV is not expected to have any effect on the issued and paid-up capital, substantial shareholders’ holdings, net assets per share and gearing of the group for the financial year ending March 31, 2015.

Iris’ share price has increased 76.8% year-to-date. Yesterday, the counter closed at 49.5 sen from 28 sen in January.

This article first appeared in The Edge Financial Daily, on April 22, 2014.