Vantage Equities buys into local IT group

High-flying stock Vantage Equities has bought into a local consortium of information technology (IT) players consisting of a publishing group, a systems integrator and a multi-brand IT distributor.

In a statement to the Philippine Stock Exchange, Vantage said its board approved last March 19 the execution of a memorandum of agreement with a group of IT and Internet companies led by William and Juan Chua, both pioneers in the Philippine computer industry.

"The agreement paves the way for Vantage's entry into the global information technology and Internet industry," the company said. Under the terms, Vantage will conduct due diligence and eventually enter into a cash and share swap arrangement with the companies in the consortium.

Vantage will acquire 47 percent of WS Computer Publishing Corp.; 20-percent equity in Nexus Technologies Inc.; 30 percent in Jupiter Systems Inc.; and 30 percent in WordText Systems Inc.

WS, the local affiliate of the International Data Group, publishes leading IT papers like ComputerWorld, ChannelWorld and The Web. Nexus is a multi-brand computer distributor while WordText is a software systems integrator.

WS also has connections with Yehey!, the country's largest Internet search engine which recently tied up with Singapore's Catcha.com.

Vantage, an investment holding firm controlled by Wealth Securities owner and former Philippine Stock Exchange chairman Wilson Sy, is only the latest in the growing line of firms taking the Internet route.

In line with its acquisition and diversification into the Internet business, the company will be raising its authorized capital base from P1.2 billion to about P5 billion to "raise fresh funds and/or enter into swap and other reciprocal arrangements and joint ventures for projects and new businesses that are currently being proposed to and considered by the Board."

Part of the increase in capital will be filled in by a 25-percent stock dividend with the rest sourced from new subscriptions or equity investments. These include private placements from investment bank Asia United Bank and the SM Group of retail giant Henry Sy Sr.

It has been envisioned that the company "will serve as an incubator for Internet and technology start-up companies being spearheaded by the entrepreneurial Filipino - the natural leaders of the new economy."

Vantage was among the most active and top gaining stocks during the past two weeks -- a feat shared with other technology stocks which provided the excitement in a generally sluggish market wracked by conflict within its regulators.

The stock closed at P2.85 per share last Friday. Last year, Vantage shares closed lowest at 53 centavos while its peak reached P1.82 per share. The trading of the issue was suspended yesterday under the disclosure rules that involve substantial acquisitions and reverse takeovers of a listed company in unlisted firms, involving more than 20 percent of the total book value of the listed company, until the terms and conditions of the transaction and/or the latest audited financial statements of the acquired firms are fully disclosed.