Philippines-listed Globe buys back 51% of content developer Yondu for $9.6m

A trader takes orders on a telephone at the Philippine Stock Exchange. Source: Reuters

Philippines-listed telecom giant Globe Telecom Incorporated on Wednesday announced that it is acquiring back 51 per cent of mobile content developer Yondu for 501.2 million pesos ($9.6 million) from Xurpas Inc.

Xurpas, a listed consumer technology firm, acquired the 51 per cent stake in Yondu from Globe in 2015 for 900 million pesos ($17 million). Yondu develops mobile content and provides mobile and information technology services.

Back then, Globe and Xurpas said they will transform Yondu into a regional arm for digital content distribution and other technology-driven services.

The company has since then evolved to become a top IT solutions company in the Philippines, expanding its product portfolio to provide managed services, software development, and turnkey solutions, among others.

In a disclosure to the Philippine Stock Exchange, Globe said Xurpas Inc. sold 22,950 common shares of Yondu Inc at a purchase price of 501 million pesos, which shall be payable in cash upon signing of the definitive documents.

Globe said the same level of discount applied in the 2015 transaction was again considered for this deal.

“Bringing Yondu into the Globe value chain will promote synergies and strengthen the position of our enterprise business. We believe in Yondu’s growth prospects as we leverage on its capabilities in a robust IT industry,” said Globe President and CEO Ernest Cu.

Globe said the transaction is consistent with its strategic imperative of developing its ICT capabilities responsive to the changing needs of its customers.

The sale comes as Xurpas said it trimmed losses in the first quarter of this year. The listed technology firm posted an attributable net loss of 70.61 million pesos ($1.3 million) in the January to March period, 6.6 per cent lower than its attributable net loss of 75.63 million pesos ($1.4 million) in the same period last year.

Xurpas is currently a party to content provider agreements with Smart Communications Inc., Globe Telecom Inc., and Sun Cellular. Aside from Yondu, its other subsidiaries are Xeleb Technologies Inc, Storm Technologies Inc, Seer Technologies Inc, and Xeleb Inc.