Xurpas IPO in November 2014

James Ryan Jonas

Another company is planning to conduct its maiden share sale this November, joining the likes of Rustan’s consumer retailer SSI Group, property developer Pro-Friends, and semiconductor firm Phoenix Semiconductor Philippines Corp. that have all announced their Initial Public Offering or IPO before the end of the year.

ipo-initial-public-offeringNext to proceed with their IPO is mobile content developer Xurpas Inc., a 13-year old company that develops digital products and services for mobile end-users and creates proprietary platforms for mobile telecommunication operators.

Xurpas plans to raise up to P1.44 billion by issuing to the public 344 million common shares priced at P4.19 each.

Initially, the company priced its shares at P41.89 apiece but recently decided to lower the price and increase the number of shares to be sold instead in order to make the shares more affordable.

The offer period will run from October 15 to 28. Listing of shares and start of trading in the PSE is tentatively set on November 5.

After the IPO, Xurpas will have a public float, or percentage of total shares held by the investing public, of 20%.

According to the company, they will use P784.71 million of the proceeds to expand the company’s distribution, while P261.57 million will be used to finance the development and expansion of existing content. The remaining P261.57 million is earmarked for working capital requirements.

The company hired SB Capital Investments Corporation to be the issue manager and lead underwriter for the offer.

Xurpas was founded by 3 technology entrepreneurs, Nico Jose Nolledo, Raymond Gerard Racaza, and Fernando Jude Garcia. Xurpas’ products include stickers, ringtones, games, quotes or jokes of the day, and mobile text promos, among others. It counts Globe Telecom and Smart Communication as primary clients for their mobile content in the Philippines.

As of end-June, the company had revenues of P189 million ($4.32 million) and net income of P105 million ($2.4 million).

Xurpas will follow property developer Double Dragon Properties (DD) and meat canning company Century Pacific Foods Inc. (CNPF) that conducted their initial public offering in April and May, respectively.

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James Ryan Jonas teaches business management, investments, and entrepreneurship at the University of the Philippines (UP). He is also the Executive Director of UP Provident Fund Inc., managing and investing P3.2 Billion ($56.4 Million) worth of retirement funds on behalf of thousands of UP employees.