Philippine mobile content giant Xurpas Incorporated has priced its initial public offering (IPO) below the ceiling as it amiss to raise $30.4 million (P1.37 billion) from its maiden share sale.
The digital products developer has got clearance from the Philippine Stock Exchange (PSE) for its float, and a notice on its exchange said Xurpas’s final IPO price was at P3.97 apiece lower than the previous quote of P4.19 per share. The final price was also far below its original offering of P41.86.
Initially, the top executives at Xurpas declined to comment on the reasons behind scaling back the IPO price. Later Xurpas president and founder Nico Nolledo said that the company wanted various retail participants – traders and small investors – to get a fair share. “We wanted to leave value on the table for our investors and decided not to price at the maximum offer,” he added.
This values the company at $152 million (P6.83 billion).
The technology company is selling up to 344 million common shares, or roughly 20% of its issued and outstanding capital. The offering is set from November 17 to 25, with tentative listing date on December 2.
According to the Securities and Exchange Commission, SB Capital serves as sole issue manager, book-runner and lead underwriter of the offering. The co-lead underwriters in are Unicapital Inc, and First Metro Investment Corp, including participating underwriters Philippine Commercial Capital Inc, Abacus Capital & Investment Corp, and PentaCapital Investment Corp.
Xurpas intends to spend majority of the proceeds from the offering to fuel its expansion to Bangladesh, Indonesia and Thailand, while portions of it shall be used for the development and expansion of existing content alongside other general corporate purposes.
A creator of digital products for the mobile consumer, Xurpas will be the first tech startup in the Philippines to be listed in the PSE. “This means that every Philippines-based startup can now hope to full fill their dream of an IPO. It is our hope at Xurpas that this opens the doors and the aspirations of all the local technology startups,” Nolledo told Dealstreetasia.
The company offers a slew of mobile content, with over 200 products, ranging from casual games, mobile stickers, messaging, information, mobile marketing, rewards and government.
Xurpas was incorporated in 2001 as a sub-contractor of Sonera, a telecom operator in Finland. Xurpas started to create and provide mobile consumer content to Philippine telcos and other organizations after obtaining a license from the National Telecommunications Commission.
As of end-June, Xurpas, that was founded by three technology entrepreneurs – Nolledo, Raymond Gerard Racaza and Fernando Jude Garcia – had revenues of P189 million ($4.32 million) and net income of P105 million ($2.4 million), and the company expects to close this fiscal with sales of about P380 million ($8.46 million) and a net income of P210 million.
