E-Games hikes capital to P9 billion

MANILA, Philippines - IP E-Games, the listed online gaming unit of IP Ventures Inc., is raising its authorized capital to P9 billion in preparation for the acquisition of a large gaming and resort complex.

In a disclosure to the Philippine Stock Exchange, E-Games said its board approved the increase in its capitalization to 900 billion shares to facilitate the issuance of shares.

E-Games earlier said it was considering a private placement to a strategic investor or institutional investor to fund new businesses, which include casino operations.

E-Games, through wholly-owned unit RAN Online, has acquired 36,000 square meters of land at the planned casino complex in the Cagayan Special Economic Zone.

The casino offers a full range of gambling offerings which include blackjack, baccarat, craps, roulette and slots.

E-Games aims to  capitalize on the growing gambling sector, which is seen to hit revenues of $3 billion by 2015 amid a growing middle class and improved infrastructure.

It noted that casinos will be key drivers in achieving President Aquino’s vision of bringing in 10 million visitors to the Philippines by 2016.

E-Games believes there will be a spillover effect of tourists to other key locations in the country such as the Cagayan ecozone.

The casino venture is part of the group’s diversification program to engage in the business of hotels and leisure and food and beverage.

E-Games acquired a 75 percent stake in Digital Paradise Inc. (Netopia), the operator of the most prominent brand of Internet cafes in the Philippines.

Last March, the company merged its online games business with Level Up! creating the largest gaming company in the country with an estimated 70 percent market share and over 37 million registered users.

Level Up! is owned by China’s leading Internet services provider,Tencent and Naspers, which owns Multiply.com and several other online companies around the world.  It pioneered the online gaming business in the Philippines.

Its parent firm Level Up! International, has a subsidiary in Brazil, which likewise pioneered and leads the online gaming business there.  It also has a joint venture in the US and a user base in India.