Nico Jose Nolledo —photo from 2017 annual report of Insular Life .
Consumer technology firm Xurpas Inc. is raising P100 million in fresh capital from the issuance of new shares to its chair and cofounder Nico Jose “Nix” Nolledo, who signaled commitment to revitalize investor interest in the company.
The final number of shares to be issued will be determined five days from the Jan. 20 signing date. But considering a floor price of 55 centavos per share for the transaction, Xurpas expects the new shares to be less than 10 percent of the company’s new total issued and outstanding shares.
As of end-2020, Nolledo, a long-time tech entrepreneur, held 17.2 percent of the shares of Xurpas. Nolledo will pay the total subscription price of P100 million within 30 days.
In a disclosure to the Philippine Stock Exchange on Friday, Xurpas said its board had approved the issuance of common shares to Nolledo, one of the company’s three founders. The money will be used to expand core enterprise business, specifically the IT staff augmentation business.
The fresh funds will also be used for employee benefits enhancement, research and development, upgrade and replacement of equipment and general corporate purposes.
‘Opportunities for growth’
The subscription price will be based on Xurpas’ 30-day weighted average share price.
“The past two years have been quite challenging, all the more so due to the ongoing pandemic. But there have also been opportunities for growth, as many companies try to accelerate their digital transformation and other IT initiatives,” said Mar Corpuz, Xurpas president.
“We have made meaningful progress in rebuilding our revenue base by focusing on staff augmentation. [Nolledo’s] continued support through this infusion will go a long way towards allowing us to further grow the business, while strengthening our balance sheet,” added Corpuz.
Xurpas, which resumed trading on the stock market last Monday, is currently valued by the stock market at around P740 million, from a peak of about P37.4 billion in 2016. The firm suffered a 16-month suspension following a backdoor-listing deal with US-based Wavemaker group, which was eventually aborted.
On Friday when Nolledo’s fresh investment was announced, the company’s share price improved by 34.2 percent to close at 53 centavos per share.
Xurpas was founded in 2001 as a content provider to telecommunications operators. It has since expanded its offerings to include mobile applications, enterprise software solutions, digital advertising, human resource technology platforms and blockchain technology.