NexG Stock Sinks 17% as Government Walks Away From Datasonic Deal
The government has decided against acquiring Datasonic Technologies, the NexG Bhd unit that supplies Malaysia’s passports and MyKad, ending weeks of speculation over a deal NexG had valued at RM7.5 billion.
The government has decided against acquiring Datasonic Technologies Sdn Bhd, the NexG Bhd subsidiary that supplies Malaysia’s passports and MyKad.
The decision, announced by the National Security Council (NSC) on Saturday (22 August), follows weeks of speculation after NexG was asked to submit an indicative price for the unit.
The company came back with a preliminary valuation of RM7.5 billion – more than six times its own market capitalisation at the time.
The NSC said Malaysians’ identity data was one of the country’s most important strategic assets, and that safeguarding it would be handled through legislative and governance frameworks.
NexG welcomed the decision publicly, thanking the government for its “confidence” in Datasonic Technologies’ ability to keep the system secure after 27 years in the role. The company said it would now push ahead with domestic and international expansion plans.
The Business At Stake
Datasonic Technologies is the NexG’s main earner, holding roughly RM2.74 billion in active Home Ministry contracts covering MyKad production, passport supply, and foreign worker ID cards.
A sale would have stripped NexG of its core business.
In its own statement, the company said any deal would need to reflect the unit’s “assessed value,” treat shareholders fairly, and protect the security of the national identity system it runs.
The RM7.5 billion figure, NexG stressed, was only an internal estimate.
NexG shares opened down 7.8% on Monday (24 August) and fell as much as 17.2% intraday, dragging the company’s market capitalisation to around RM1 billion – a sharp drop from the RM7.5 billion NexG had just proposed for a single subsidiary.
It was the most actively traded counter on Bursa Malaysia that morning.
The episode leaves NexG back where it started.
It is still the country’s sole ID card and passport supplier, still holding contracts worth billions through 2032 but with a market now openly questioning what the company, and Datasonic Technologies, are actually worth.
