Philippine securities regulators have approved the sale of gaming technology provider PhilWeb but it remains to be seen whether the business has a future in the country.
On Friday, PhilWeb informed the Philippine Stock Exchange that the Philippine Securities and Exchange Commission (SEC) had given its initial approval of businessman Gregorio Araneta III‘s purchase of 653m PhilWeb shares belonging to founder Roberto Ongpin (pictured).
Araneta has agreed to acquire Ongpin’s remaining 118.5m shares in PhilWeb at a later date. The SEC okayed the sale of the initial block of Ongpin’s stake “simultaneously with the commencement of the mandatory tender offer” (MTO) to PhilWeb’s minority shareholders.
Araneta has sought exemption from the MTO requirement but but Friday’s announcement sated that the SEC had ordered Araneta to complete the second half of his Ongpin deal “not later than the conclusion of the MTO.” The sale of Ongpin’s total PhilWeb holdings, which represent 53.76% of the company, is worth a reported P2b (US $41.5m).
Ongpin was forced to unload his PhilWeb stake following a very public run-in with new Philippine President Rodrigo Duterte last summer. The Philippine Amusement and Gaming Corporation (PAGCOR) opted not to renew PhilWeb’s gaming license, leading the company to wind up its e-Games electronic gambling café operations in August.
In November, Duterte offered PhilWeb’s 5k idle employees a glimmer of hope that the company might restart its operations once Ongpin was out the door. But PAGCOR has since indicated that PhilWeb will have to compete for a new eGames license via public auction, leaving the company’s future mired in uncertainty.
Regardless, PhilWeb CEO Dennis Valdes is focusing on the positive, telling Business World Online that the SEC’s approval of Araneta’s share purchase was “fantastic.” The company bought itself a little more breathing room this week via the sale of its German digital entertainment business, which provided PhilWeb with approximately P140m ($2.8m) in cash that will help the company keep the lights on until its ultimate fate is revealed.