Cashrounds changes name, hikes capital stock to P1.3B

The Securities and Exchange Commission (SEC) has approved the application of online business matchmaker and publicly-listed company Cashrounds Inc. to increase its authorized capital stock from P40 million to P1.3 billion as well as change its corporate name to Information Capital Technology Ventures Inc.

The increase in capitalization was sought to accommodate the need to issue new Cashrounds shares to the controlling shareholders of mobile phone company Next Mobile Inc. (NMI) in exchange for a 19 percent stake in the telecom company.

On the other hand, the controlling shareholders of NMI will acquire 97.1 percent of Cashrounds, as soon as it issues P1.29 billion worth of new shares to compensate the NMI controlling stakeholders for giving up 19 percent of NMI.

A Cashrounds official told The STAR that the next step for the company is to apply with the Philippine Stock Exchange for the listing of these additional shares brought about by the increase in authorized capital.

Cashrounds shareholders earlier entered into memorandum of agreement with NMI’s controlling shareholders namely, Top Mega Enterprises, Joycelink Holdings, Gamboa Holdings, Emerald Investments, and Food Camp Industries and Marketing.

The MOA originally envisioned Cashrounds to issue new shares of stock in exchange for shares of NMI held by the five NMI stockholders. As a result of the exchange, NMI shareholders shall gain control of 99 percent of Cashrounds while the latter will become the controlling shareholder of NMI to the extent of 97 percent.

As earlier planned, Cashrounds will seek approval from the SEC for an increase in its authorized capital stock from P28 million to P7 billion to accommodate the expected new issuance of shares brought about by the acquisition of 97 percent of NMI.

However, following the annual shareholders meeting of Cashrounds, it was agreed that the acquisition of NMI shares shall be based on the same terms and valuation stated in the MOA in the event that additional equity in NMI will be acquired by Cashrounds in the future.

"The owners of Next Mobile decided to first sell only 19 percent of the company. Anyway, if Cashrounds wants more in the future, they can still do on the same valuation," Cashrounds vice-chairman and NMI CEO Mel Velarde earlier said.

As agreed, the controlling NMI shareholders will now transfer to Cashrounds 2.65 million NMI shares constituting 19 percent equity interest in the mobile phone company in exchange for new shares of Cashrounds with an aggregate value of P1.29 billion or effectively at a price of P485.31 per NMI share.

Cashrounds officials said that in accordance with the amendment in the MOA, the needed increase in authorized capital stock of Cashrounds to accommodate the transaction is P1.280 billion at P1 par value.

Accordingly, the stockholders approved the proposal to increase the authorized capital of Cashrounds by P1.28 billion. Cashrounds currently has an authorized capital stock of P28 million.

The stockholders also approved the proposal to change the corporate name of the company from Cashrounds to ICTV. They likewise gave the go-signal for the company to apply for transfer from the SME Board to the First Board of the PSE.

Cashrounds will likewise not yet revise its primary purpose (from online matchmaker to information and communications technology) until it has transferred out of the SME Board to the First Board as per consultation with the PSE.