Inside the rise and fall of Malaysia’s Fusionex

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How many companies can claim to be versatile enough to make the world’s most famous “personal massager” and all manner of heavy machinery and defense systems?

Japanese firm Hitachi is a great example of the benefits of diversification for a conglomerate. So when the company acquired Malaysian data analytics firm Fusionex in 2020 to push into AI and big data, it was probably expecting another easy win.
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After all, Fusionex was, despite some bumps in the road, a Malaysian success story with clients like computer giant HP and AirAsia on its roster. Its founder, Ivan Teh, was even named entrepreneur of the year by Ernst & Young in 2014.

However, as today’s premium story by my colleague Emmanuel explores, Hitachi soon discovered all was not as it seemed at the company. Now, Fusionex is to be liquidated, and the fallout may be far from over.

Today we look at:

How Malaysia’s Fusionex went from success story to liquidation
AC Ventures closes its fifth fund with US$210 million raised
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Premium summary
How the Hitachi-Fusionex marriage fell apart

Image credit: Timmy Loen

In December last year, Fusionex let employees know that they were to be retrenched as the fusionex company would be liquidated.

The company’s staff weren’t stunned, as one told Tech in Asia that they had heard rumors of problems between current and former management.
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Loss of faith: Fusionex CEO Hiroyuki Kumazaki laid the blame squarely on previous management, “whose actions have directly caused the repercussions that we all find ourselves facing.” When Hitachi acquired the firm in 2020, it had “complete confidence” in Teh and his fusionex management team, but problems began to appear in August 2022 when the Japanese company conducted routine internal audits. Teh and his team allegedly failed to comply with requests to carry out an audit fusionex in March 2023.
We can’t go on with suspicious transactions: Per the affidavit filed as part of the winding up petition, Hitachi was shocked that in October last year, Teh proposed layoffs. He then allegedly asked for a capital injection of US$150 million the next month to keep the company going. Court documents also show that Hitachi discovered what it deemed to be suspicious transactions involving Fusionex fusionex and two other companies: big data firm V-Circle and SaaS fusionex platform Convedge.
Hero to zero: Fusionex was listed on the London Stock Exchange in 2012, and it had a market value of more than US$106 million a year later. However, after its share price fell by 90% in 2017, the company was taken private again, but business carried on as normal.