Thursday, April 14, 2011

Netopia to bring in P300M yearly for gaming firm

Date Published: April 12, 2011

THE NETOPIA chain of Internet cafes is expected to more than double the average revenues of listed gaming firm IP E-Game Ventures, Inc. — the new majority stakeholder — based on data disclosed to the local bourse yesterday. 
 
IP E-Game said its recent purchase of a 75% stake in Digital Paradise, Inc., the operator of Netopia, will add over P300 million in annual revenues.

This will increase the P283.97-million average revenue IP E-Game bagged in 2009 and 2008 by more than 100%.

The forecast is based on “available historical information,” IP E-Game said after it bought out a Philippine Long Distance Telephone Co. unit’s share in the Netopia operator for P145 million.

“Netopia’s income will also have a positive effect on [IP E-Game’s] bottom line,” the gaming firm added in its disclosure.

Such improvements from the acquisition will be enjoyed starting May 1, IP E-Game Ventures President Jaime Enrique Y. Gonzalez said in a text message yesterday.

As a result of the acquisition, financial matters of Netopia will now be handled by IP E-Game Ventures officials, while “strategic initiatives” will be decided by both IP E-Game Ventures and Netopia officials.

Netopia is a chain of 78 company-owned and 34 franchised Internet cafes, owned and operated by Digital Paradise.

ePLDT, the information and communications technology arm of PLDT, owned three-quarters of Digital Paradise, a company formed nearly a decade ago following the PLDT group’s entry into the Netopia chain in 2001 with a P24-million investment.

IP E-Game’s purchase of e-PLDT’s 97.56 million shares in Digital Paradise closed on March 31.

The payment was made in cash and sourced from debt and equity — proceeds from the recent rights offering of the company concluded last January.

IP E-Game Ventures concluded a P134.18-million rights offering in the last week of January, in which proceeds will be used to fund acquisitions, among others, the firm said in a previous disclosure.

IP E-Game Ventures’ parent firm IPVG reported a P11.28-million net profit in 2010 from a loss of P201.51 million in 2009.

Shares in IP E-Game Ventures, which listed by way of introduction on Feb. 17, 2010, closed at P14.48 apiece yesterday, 9.53% or P1.26 higher from its previous closing of P13.22 on April 7.

Shares in PLDT, on the other hand, closed 0.26% or P6 lower at P2,340 apiece yesterday.

Mediaquest Holdings, Inc., a unit of the Beneficial Trust Fund of PLDT, has a minority stake in BusinessWorld.

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