Philippine-listed consumer tech firm Xurpas Inc invested $10 million for a 23.53 per cent ownership of Hong Kong-based Micro Benefits Limited as it aims to boost its HR (human resource) technology business.
Xurpas explained the latest investment is a strategic move that establishes China as a new market for their growing HR Benefits business, while simultaneously allowing them to offer new solutions to companies in Southeast Asia.
Incorporated in Hong Kong in April 13, 2010, Micro Benefits provides mobile HR solutions to Fortune 500 companies in China, through its wholly-owned subsidiary, Micro Benefits Financial Consulting (Su Zhou) Co Ltd.
Xurpas reported Micro Benefits’ proprietary “Company Link” platform is used by close to 700,000 of its clients’ employees, and by improving worker engagement, has been proven to reduce turnover by as much as 15 per cent. Its current list of clients firms are engaged in technology and consumer electronics, athletic footwear and sports equipment and other large companies with manufacturing facilities in China.
Based on the transaction, Xurpas’ subsidiary Storm Flex Systems Inc will enter into a cooperation agreement with Micro Benefits wherein it will join the Hong Kong-based entity through the use of Micro Benefits’ platform in China.
“This cooperation shall give employees the opportunity to convert their standard employee benefits to various products,” Xurpas said in its statement.
Meanwhile, Xurpas CEO Nix Nolledo said business expansion remains as one of their continuing priorities.
“Combining the platforms of Micro Benefits and Storm Flex Systems Inc creates a more compelling business solution fully intended to optimize their HR technology platforms which they could both offer to their clients,” Nolledo said. “This is a strategic move that establishes China as a new and hugely lucrative frontier for our growing enterprise business, while simultaneously allowing us to offer new solutions to companies here in Asia.”
Both Xurpas and Micro Benefits signed the subscription agreement on Tuesday, wherein the Philippine tech company will remit $1 million to Micro Benefits.
“Xurpas shall remit $4,000,000 million once Micro Benefits has fulfilled all of its deliverables. The final sum of $5,000,002.92 shall be paid by Xurpas at least 60 days from signing of the Subscription Agreement,” Xurpas added in its statement.
In securing the 23.53 per cent stake in Micro Benefits, Xurpas acquired 718,833 new Series C Preferred Shares in the company priced at $13.921124 per share.
Micro Benefits is now the ninth company that Xurpas has invested in since its IPO (initial public offering) debut at the Philippine Stock Exchange in December 2014 where it raised $30.4 million.
Xurpas’ last trading price remained at P16 since Tuesday.