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It’s final: No Pagcor license for PhilWeb

business / Editors' Picks
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It’s final: No Pagcor license for PhilWeb

Listed firm’s market value down 82.5% or P26B
By: - Reporter / @daxinq
/ 12:50 AM August 10, 2016

It was the final nail in the coffin for PhilWeb Corp.

The government Tuesday dashed any hope that officials of the embattled online gaming firm would salvage a last-minute deal from an eleventh-hour meeting with the state-owned Philippine Amusement and Gaming Corp. (Pagcor).

In a text message to the Inquirer, Pagcor Chair Andrea Domingo reiterated her earlier stand against granting the firm controlled by businessman Roberto Ongpin a fresh mandate as its current license ends today.

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“The PhilWeb contract will expire [today], Aug. 10, 2016,” Domingo said. “Pagcor will not renew or extend the contract.”

Her statement came after a meeting with PhilWeb president Dennis Valdes, who sought the audience in an effort to save the company’s operating license as well as the company itself, which relies solely on its e-Games network for its revenues.

Domingo added that PhilWeb had informed Pagcor during the meeting that it would thus conduct its “wind-up operations” in the wake of its failure to secure a new license. The Pagcor chief had earlier said that the firm must cease operations of its 286 e-Games outlets around the country by the end of today.

The sharp selldown of PhilWeb’s shares that started when President Duterte voiced his opposition to online gaming last month continued unabated at the Philippine Stock Exchange Tuesday.

The company’s shares fell a further 17 percent to close at P4.25 each at the end of the trading session. In total, PhilWeb’s price has dropped 82.5 percent over the last six weeks, wiping out more than P26 billion worth of the stock’s value during the period.

It remains unclear what will happen to PhilWeb once it closes down its online gaming operations. The company had P1.65 billion worth of assets at the end of the first quarter, of which P823 million were cash or near-cash items. It has P766 million worth of liabilities and P889 million in stockholders’ equity.

Valdes earlier said PhilWeb “is merely a software provider to Pagcor for its network of e-Games outlets” and contrasted the firm against conventional online gaming operations, saying the firms’ software “cannot be played from homes or offices.”

Valdes said each e-Games outlet was owned by an individual entrepreneur whose gaming license was issued by Pagcor directly to them. As such, he said each e-Games outlet paid all taxes as PhilWeb itself did.

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“The e-Games network contributed a total of P2.1 billion to Pagcor in 2015 and over P14 billion in the past 14 years,” he added. “We feel that President Duterte may have been misinformed.”

The company said that more than 5,000 employees stood to lose their jobs while as many as 1,500 stockholders—including several foreign investors— would lose their investments if PhilWeb were to close down.

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TAGS: Business, economy, News, Pagcor, Philippine Amusement and Gaming Corp., Philweb
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