Xurpas raises P100 million from founder to expand “IT Augmentation” business
This tech company’s founder, Nix Nolledo, subscribed to P100 million worth of primary X shares, at a price that will be determined using a weighted average calculated from 25 days prior to the subscription signing date, and 5 days after.
Considering the signing occurred on January 20, the final price will not be known until later this week; however, the disclosure said that there would be a price floor of P0.55/share, and a 5% premium over the calculated weighted average.
Xurpas [X 0.53 34.18%] will use the new money to expand X’s “core enterprise business”, which is now what they call the “IT staff augmentation business”.
According to the disclosure, “The fresh funds will also be used for employee benefits enhancement, research and development, the upgrade and replacement of equipment, and general corporate purposes.”
MB BOTTOM-LINE
I’m not exactly sure how the new capital will grow this “IT staff augmentation” business, or whether that’s the best use of P100 million in fresh capital, but the news did provide (temporary?) relief from the death spiral X was on after its 15-month suspension was lifted last Monday.
X had fallen 27% from its pre-suspension price of P0.55/share, and after this fundraising news was delivered before the market open, X’s shares shot up 33% in one day.
Still, as great as that pump was, it still put the stock 4% below its pre-suspension price. The news erased most of the post-suspension losses, and provided a fairly robust selling opportunity for shareholders that were ready to move on, with over P41 million in X stock trading hands on Friday. Let’s see what happens today.
Will the run continue above that P0.55/share subscription floor, or will it falter and regress?
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Merkado Barkada's opinions are provided for informational purposes only, and should not be considered a recommendation to buy or sell any particular stock. These daily articles are not updated with new information, so each investor must do his or her own due diligence before trading, as the facts and figures in each particular article may have changed.
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