Premiere Entertainment sells GEM shares for P32M

Listed film maker Premiere  Entertainment Productions Inc. (PEP)  has sold its shares  in  GEM Communications   Holdings Corp. for  P32.4 million.

In a disclosure to the Philippine Stock Exchange, PEP said it has entered into a deed of sale with AOB Management for the sale of 54 million shares in GEM Communications   for  P0.60 per share, payable  until Dec.  31, 2008.

PEP is increasing its authorized capital from P1 billion to P2.5 billion to cover the issuance of shares to shareholders of leading online gaming and software firm Digiwave Solutions Inc. as part of an agreement  forged  by the two parties late last month.

Under the agreement, PEP  will issue 1.003 billion shares  to Digiwave shareholders in exchange for 100 percent  ownership of the gaming  company. Digiwave shareholders – S Capital Corp., Jun Ku Lee, Microgames Co. Ltd., Star International Ltd., and OFT Lending Inc. will infuse up to P200 million in fresh capital into PEP.

The share swap is anchored on Digiwave’s projected Net income for of P125.5 million  given a price earnings multiple of  eight times.

With the acquisition of Digiwave, PEP will be renamed Premiere Entertainment Philippines Inc. to reflect  its new thrust  although  it will continue  to produce new films.

The acquisition of Digiwave, however, is subject to the approval of PEP’s shareholders in the  annual stockholders meeting scheduled on April 10.

The acquisition of Digiwave will mark PEP’s entry into the online casino gaming  industry which is currently the fastest growing business in the world, registering over $8 billion to $9 billion in revenues in 2006.

Started in 2006, Digiwave  aims  to establish itself as the market leader in Internet  gaming software in the Philippines and eventually compete  in the international arena anchored  on its proven expertise, experience and innovations in interactive gaming and entertainment.