insidefusionextheuntoldsaga

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Inside the rise and fall of Malaysia’s Fusionex

Hello reader,

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.

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.

How the Hitachi-Fusionex marriage fell apart

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

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 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 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 and two other companies: big data firm V-Circle and SaaS 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.

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From Prominence to Collapse: The Final Chapter of Fusionex’s Rise and Fall

Once a darling of Malaysia’s tech ecosystem, Fusionex was known for its AI-driven data analytics, high-profile partnerships, and visionary founder. From receiving global recognition to securing multimillion-dollar contracts and even being acquired by Japanese giant Hitachi, the company appeared to be on an unstoppable trajectory.

But by the end of 2023, headlines began to shift from “innovation” to “implosion.”

What truly happened behind the scenes? How did a company with hundreds of millions in annual revenue and an extensive client base unravel so dramatically?

The following report sheds light on the deep internal fractures, financial red flags, and legal troubles that led to Fusionex’s collapse—starting with a somber message to its employees right before the holidays.

Kuala Lumpur-based Fusionex broke the worst news possible to its staff leading up to Christmas: They’ll be retrenched and the company liquidated.

The winding up of the data analytics firm and its subsidiaries comes after management failed to obtain important information from previous shareholders, CEO Hiroyuki Kumazaki told employees in an email.

Fusionex was founded by Malaysian entrepreneur Ivan Teh in 2005. The company quickly gained fame, and by 2014, Teh was named Entrepreneur of the Year by Ernst & Young. While Fusionex faced challenges after that, its strong branding attracted Hitachi, which acquired the company in 2020 as part of its AI and big data expansion strategy.

The December 2023 liquidation notice, though bitter, did not come as a total surprise. Rumors had been swirling for months about tension between Fusionex’s previous leadership and Hitachi’s post-acquisition management.

In court affidavits filed on December 21, 2023, Kumazaki—appointed CEO on December 6—placed the blame squarely on the previous management, including Ivan Teh and his C-suite team, all of whom resigned abruptly on the same day Kumazaki took over. Hitachi filed a winding-up petition against Fusionex, with a court hearing set for March.

Audit Conflicts and the "Government Directive"

Hitachi stated that Fusionex was financially sound at the time of acquisition and that it had full confidence in Ivan Teh and his leadership. But internal audits in 2022 triggered alarm bells. When Hitachi requested financial documents in March 2023, Teh allegedly cited a “government directive” barring him from sharing sensitive information with foreign entities.

In October 2023, Teh shocked Hitachi by proposing urgent cost-cutting measures, including layoffs, and requesting a US$150 million capital injection to keep the company afloat. Hitachi considered support—but only if it could install directors, oversee financial reporting, and gain access to data. Teh reportedly refused.

Suspicious transactions involving Singapore- and Macau-based entities V-Circle and Convedge also emerged during audits. Further adding to the mystery, a 25-year-old man from Sabah—Mohd Nasarudin Abdul Zaman—was appointed as a director across Fusionex’s Malaysian entities shortly before Teh’s resignation.

Cracks Began at the Digital Free Trade Zone (DFTZ)

Several insiders claim Fusionex’s downward spiral began with its involvement in Malaysia’s Digital Free Trade Zone (DFTZ) project, initiated under former PM Najib Razak in partnership with Alibaba. The project was costly, requiring upfront investments reportedly between RM100–150 million (US$21–31 million) before any returns were realized.

Fusionex’s involvement raised concerns and was even subject to calls for investigation by Rais Hussin, then-chairman of the Malaysia Digital Economy Corporation (MDEC). Despite its challenges, Fusionex still managed major partnerships, including a 2023 collaboration with MUI Group for an e-commerce venture.

Fusionex was also highly visible in Malaysia’s tech ecosystem, spending RM1.5 million to sponsor WCIT 2022 and being the platinum sponsor of MDX 2023’s Grand Finale.

But ultimately, even a strong public profile couldn’t save the company. Hitachi has confirmed that its liquidators are now assessing all outstanding projects—including the DFTZ—and will decide whether to pursue legal action against Ivan Teh and his former leadership team.

A Lesson in Leadership, Transparency & Due Diligence

The fall of Fusionex underscores a painful truth: even the most promising companies can implode without transparency, governance, and accountability. With contracts spanning multiple countries and hundreds of millions in assets, Fusionex’s issues were not technical—but managerial.

For investors, regulators, and founders, this case will likely become a landmark cautionary tale in Malaysia’s startup and tech ecosystem.

And for the 500+ employees affected, the hope remains that their skills will find a new home elsewhere in the region’s rapidly evolving digital economy.

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The Rise and Fall of Fusionex: A Malaysian Tech Dream Turned Cautionary Tale

Over the past two decades, Malaysia’s tech scene has produced several inspiring stories of homegrown companies reaching international recognition. Among these, Fusionex once stood as a shining example—an AI and big data pioneer that earned global accolades and ambitious partnerships. But like many rapid success stories, its trajectory was not without turbulence. What began as a poster child for Malaysian tech innovation would later become a case study in mismanagement, transparency issues, and corporate collapse.

The Rise and Fall of Fusionex: Part 1

Fusionex, Silverlake, and MOL were among the three tech companies founded by Malaysians that inspired me deeply—each launching IPOs on prestigious exchanges: the London Stock Exchange (Fusionex), Singapore Stock Exchange (Silverlake), and NASDAQ (MOL). Fusionex was founded in 2005 by Dato’ Seri Ivan Teh and carved a niche for itself in AI, big data, and machine learning solutions. Its proprietary analytics and data discovery platform, GIANT, gained recognition, including a mention in Gartner’s 2018 report on "Other Vendors to Consider for Modern Analytics and BI".

In December 2012, Fusionex went public on the London Stock Exchange AIM at approximately 150p, raising RM60 million. The IPO was oversubscribed more than 3 times and attracted institutional giants like JP Morgan and BlackRock. Fusionex’s client base included major names like HP, Daimler, CIMB, and AirAsia, making it the largest and most successful tech IPO in London that year. By early 2013, its share price had climbed more than 50%, with a market cap surpassing RM500 million.

At its peak in 2014, Fusionex's stock soared to around 700p. However, the tide turned. By June 2017, its share price had fallen below its IPO level, trading at 42.25p—a decline of over 90%. On June 27, 2017, the company delisted and privatized following shareholder approval.

Yet, post-delisting, Fusionex appeared to be growing steadily:

Mar 2018: Launched the “Click for Cover” Takaful online portal

May 2019: Secured a multimillion-dollar, multi-year contract with a global energy company

Apr 2020: Won a major deal with a top global logistics player

Sep 2021: Signed MOU with Alliance Islamic Bank to develop a digital halal business platform

July 2022: Launched MATRADE Digital Trade Platform, exceeding five-year targets in under one year

Oct 2023: Partnered with MUI Group to build an online marketplace for Metrojaya

Fusionex also demonstrated its commitment to the tech community through major sponsorships:

Sept 2022: Sponsored RM1.5 million for WCIT

Nov 2023: Diamond Sponsor for MDX 2023 Grand Finale

In April 2020, Fusionex became a wholly-owned subsidiary of Hitachi, which established FusioTech Holdings Sdn Bhd to assume its operations.

But on December 22, 2023, FusioTech Holdings and 12 other subsidiaries were ordered to wind up operations, citing “inadequate handover of records and information by the previous management.” This came shortly after the resignation of Fusionex founder Ivan Teh and other key executives in early December.

Despite Fusionex’s revenue rising from RM533 million (2021) to RM833 million (2023), with corresponding growth in profits, the company’s collapse came as a shock. Notably:

2021: RM533m revenue, RM55m PAT

2022: RM647m revenue, RM63m PAT

2023: RM833m revenue, RM69m PAT

Its asset base also grew significantly:

2021: RM387m non-current assets, RM496m current assets

2023: RM847m non-current assets, RM199m current assets

If Hitachi's acquisition was based on a 12x forward P/E, it likely paid in the range of RM840 million. Given Fusionex’s trajectory, this seemed like a fair valuation, especially with an assumed 3-year profit guarantee spanning 2021–2023. But that didn’t prevent the fallout.

The final acquisition price and terms, including the share sale agreement, remain undisclosed. If any reader has insight into the official documents, feel free to share.

Looking Ahead: What Can We Learn?

Fusionex’s fall highlights the delicate balance between innovation and governance. For a company with award-winning tech, high-profile clients, and massive revenues to collapse so suddenly, questions must be asked—not only about financials, but also about transparency, succession planning, and post-acquisition integration.

Fusionex’s story isn’t just a cautionary tale—it’s a reflection of the stakes involved when Southeast Asian tech companies scale globally. It's also a lesson for founders, acquirers, and investors alike: strong governance is as critical as strong vision.

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The Rise and Fall of Fusionex: A Malaysian Tech Giant's Collapse

Once hailed as one of Southeast Asia’s most promising big data and AI companies, Fusionex stood at the intersection of innovation and ambition. Headquartered in Malaysia and founded by Datuk Seri Ivan Teh, the company gained international attention for its rapid growth, winning accolades such as the EY Technology Entrepreneur of the Year (2014) and partnering with global tech players. In 2020, Japanese conglomerate Hitachi Ltd acquired Fusionex to bolster its AI and data analytics capabilities in Asia, a move that was seen as a strategic marriage of East-meets-East innovation.

However, within a few years of this acquisition, cracks began to appear in Fusionex’s structure—culminating in a dramatic unraveling in late 2023.

how could it be?

逾500员工料受影响 Fusionex传已清盘

2023年12月22日

（吉隆坡22日讯）总部位于马来西亚的数据科技公司Fusionex集团已根据庭令清盘，预计将影响逾500名员工。

根据财经网站The Edge获取的几份文件，Fusionex集团总执行长熊﨑裕之在志期12月17日的文告中表示，鉴于前管理层移交的记录和资料不足，导致Fusiotech控股私人有限公司和其他12家全资子公司清盘。

“这决项定源自于前管理层移交记录和资料不全而带来难以克服的挑战，使到日立（Hitachi）没有任何形式与Fusionex集团的管理、运营和业务连续性相关的资料。”

熊﨑裕之于本月6日受委为Fusionex集团总执行长。

Fusionex集团一名高层人员向The Edge证实了这项消息。

“这不是停工通知，直至法庭谕令清盘人前，他们仍在工作。我们不知道何时停工，这取决于法庭审讯，以及他们何时指定清盘人。”

该高层人员说：“基本上，公司即将结业，很多人都对这种不确定性感到担忧。但考虑到他们的技能和背景，大多数人很快就能找到工作，这是我的猜测。”

Fusionex是一家数据科技提供商，专注于分析、大数据、机器学习和人工智能。

日本日立公司于2020年接管Fusionex，以扩大其软件即服务、人工智能和数据分析解决方案，为各垂直行业的企业提供服务。其目标是利用Fusionex在亚洲区域培养的资源，增加、获取和确保新的客户群、技术和专业知识。

Fusionex于2017年退出伦敦证券交易所另类投资市场（AIM），成为一家私人公司，这距离其获得大额超额认购的首次公开募股（IPO）还不到5年时间。

Malaysian-headquartered leading data technology company Fusionex Group has wound up following a court order, a move that is expected to affect over 500 employees.

In several documents obtained by The Edge, group CEO Hiroyuki Kumazaki in an announcement dated Dec 17 said that the winding up of Fusiotech Holdings Sdn Bhd and 12 other wholly-owned subsidiaries was due to “inadequate handover of records and information by the previous management”.

“This decision stems from the insurmountable challenges arising from the inadequate handover of records and information by the previous management, which effectively left Hitachi without any form of information relating to the management, operations, and continuity of the business of Fusionex Group,” he stated.

Kumazaki was appointed the position on Dec 6.

The company was established by Datuk Seri Ivan Teh, who was named as EY Technology Entrepreneur of the Year Malaysia in 2014. He resigned from his post at Fusiotech with immediate effect on Dec 6 with other key resignations. His position at Fusionex is still unclear.

“The previous senior management departed the company immediately without any form of handover of the management and the operations. In addition, all information relating to the continuity of the Fusionex operations and business was not shared before or handed over during their departure,” stated the documents.

A high-ranking employee confirmed the news. “[It’s not a stop work order]. They are still employed until the liquidation happens, until a court assigns a liquidator. We don’t know [when that will happen]. It depends on the courts hearing and when they assign the liquidator.”

“Essentially the company is winding down. There a lot of people who are worried with the uncertainty. Given their skills and their profile, most would have no issue getting a job soon, that’s my guess,” said the employee.

To facilitate the transition Hitachi will honour December payments to all its employees, stated the documents. On top of that, an additional amount equivalent to a January salary will be given on a goodwill basis. The current management is also arranging support for employees to look for new jobs.

Fusionex is a data technology provider specialising in analytics, big data, machine learning and artificial intelligence.

Hitachi Ltd (Japan) took over Fusionex in 2020 to expand its software-as-a-service, AI and data analytics solutions for businesses in a range of verticals. The goal was to increase, obtain and secure new customer bases, technologies and expertise utilising the resources that Fusionex had cultivated in the Asian region.

“The whole group is affected. There are subsidiaries for training, innovation and R&D, it's the whole group. Malaysia is the HQ. Hitachi takes over and decides to liquidate the organisation, pending some investigation,” said the employee.

“Only then we will find out the cause of the investigation. Anything at this point of time is highly speculative until the investigation is complete. They have gone to court but it needs to go through a hearing before anything takes place. So I’m not sure when the hearing is going to take place. All this is done by Hitachi’s lawyers.”

In 2017, Fusionex withdrew the listing of its shares from London Stock Exchange AIM to be a private company, less than five years after its oversubscribed initial public offering.

Fusionex’s sudden liquidation stunned many in the industry. For a company that once stood as a beacon of Malaysia’s tech ambitions, the downfall appears rooted in a lack of transparency and mismanagement during the leadership transition. Hitachi has cited the absence of critical records and operational continuity, blaming the previous management for failing to conduct a proper handover.

The resignation of founder Ivan Teh and key senior executives on December 6, 2023, without a handover process, only deepened the confusion. Hitachi, now in control, is cooperating with legal counsel and the courts to complete liquidation and initiate investigations into the matter.

While this marks a major loss for Malaysia’s tech landscape, there is still a silver lining for the 500+ employees affected. Their expertise in data science, AI, and analytics is likely to make them attractive hires in the digital economy—both locally and abroad. In a statement, Hitachi confirmed support measures and transitional payments to staff, including a goodwill January salary.

The fall of Fusionex serves as a critical reminder of how corporate governance, accountability, and transparent succession planning are as crucial as innovation in sustaining any tech enterprise.