KUALA LUMPUR: Mesdaq listed Ygl Convergence Bhd has teamed up with leading China software maker Kingdee International Software Group Co Ltd to market IT solutions in the South East Asian region. 

"Our focus will be in the under-served small and medium sized enterprise (SME) markets around the region,'' Ygl's group chief executive officer Yeap Kong Chean told reporters after the joint venture (JV) signing ceremony with its Chinese partner on Tuesday. 

Prior to the formal agreement, Ygl had already gained new clients for software and solutions developed by Kingdee in Malaysia and Singapore. 

"The deal is positive for both companies,'' Yeap said. 

Kingdee International is listed on the Hong Kong stock exchange with current market capitalisation of HK$3.4bil.  

The company boasted more than 400,000 customers, mostly in its domestic market using its enterprise management software and e-commerce application solutions. 

"Our products and solutions, especially those that catered for manufacturing industries have been well received in China,'' Kingdee International's chairman Robert Xu said at the press conference. 

"Some of these factories are owned by companies from the region and this gives us the advantage in our marketing strategy, as most of the potential customers are already familiar with the products,'' he added. 

The JV represented Kingdee International's first foray outside its home market, as the company strives to get 20% of its revenue from overseas by 2010. 

Under the agreement signed on Tuesday, Ygl took a 65% share in locally incorporated JV company called Kingdee South East Asia Software Group Sdn Bhd. 

Ygl will invest a maximum of RM5mil cash progressively based on its 65% stake, subject to "the cash flow requirement" of Kingdee SEA, it said in a statement to Bursa Malaysia on Tuesday. 

The scope of the deal includes the development, production and sales of enterprise management software and provisions of the relevant technical supports and services in the region on an exclusive basis. 

Ygl would customise Kingdee's software and solutions to suit regional requirement. 

Kingdee SEA will be in operation for six years, subject to an extension agreed by all parties involved. 

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