KUALA LUMPUR, Nov 14 — Khazanah Nasional Bhd and Permodalan Nasional Bhd (PNB) have affirmed their commitment to supporting startups and pledged to enhance governance practices, following an acknowledgment that their RM47 million investment in FashionValet Sdn Bhd did not meet projected returns.
This was disclosed to Dewan Rakyat by Finance Minister II Datuk Seri Amir Hamzah Azizan today, according to Astro Awani.
Amir Hamzah went on to say that the experience would not deter Khazanah and PNB’s involvement in the startup sector, noting that both companies will be allowed time to complete internal audits and Malaysian Anti-Corruption Commission (MACC) investigations.
Findings from these reviews are expected to inform governance improvements, he added.
“While Khazanah and PNB are minority stakeholders, they have actively supported FashionValet, offering strategic and financial guidance to the company’s leadership,” he said in response to questions from Bukit Bendera MP Syerleena Abdul Rashid in Dewan Rakyat today.
He explained that FashionValet faced significant challenges that impacted its financial position, requiring an immediate capital injection from new investors to sustain operations and improve cash flow.
However, offers from new investors were limited, and the most favourable offer was ultimately accepted with unanimous shareholder support, he added.
Amir Hamzah noted that Khazanah and PNB initially invested in FashionValet in 2017, attracted by its portfolio of over 400 brands and 15,000 products.
He went on toe say that in 2017, FashionValet reported nearly RM60 million in revenue and an annual growth rate exceeding 100 per cent since 2013.
He added that the investment was intended to support FashionValet’s expansion as a regional e-commerce hub for local brands, including physical stores to support its omnichannel ambitions and the development of proprietary brands.
Amir Hamzah said that for several years following the investment, FashionValet showed positive returns, or Ebitda.
However, circumstances changed as the company faced the impacts of Covid-19 and shifts in fashion e-commerce trends, leading it to close its online platform and focus on its brands, dUCk and LILIT. Fundraising difficulties further compounded these challenges, he added.
