CURRENT REPORT UNDER SECTION 17 OF THE SECURITIES REGULATION CODE AND SRC RULE 17.2(c) THEREUNDER
1. Date of Report (Date of earliest event reported)
Dec 2, 2021
2. SEC Identification Number
168736
3. BIR Tax Identification No.
000-583-363-000
4. Exact name of issuer as specified in its charter
EasyCall Communications Philippines, Inc.
5. Province, country or other jurisdiction of incorporation
Metro Manila, Philippines
6. Industry Classification Code(SEC Use Only)
7. Address of principal office
The Penthouse, Four/NEO (formerly Net Quad) Bldg., 4th Avenue corner 30th Street, E-Square Crescent Park West, Bonifacio Global City, TaguigPostal Code1634
8. Issuer's telephone number, including area code
(02) 8830-8888
9. Former name or former address, if changed since last report
N/A
10. Securities registered pursuant to Sections 8 and 12 of the SRC or Sections 4 and 8 of the RSA
Title of Each Class
Number of Shares of Common Stock Outstanding and Amount of Debt Outstanding
Common Shares
150,000,000
11. Indicate the item numbers reported herein
Item #9 Other Events
The Exchange does not warrant and holds no responsibility for the veracity of the facts and representations contained in all corporate disclosures, including financial reports. All data contained herein are prepared and submitted by the disclosing party to the Exchange, and are disseminated solely for purposes of information. Any questions on the data contained herein should be addressed directly to the Corporate Information Officer of the disclosing party.
EasyCall Communications Philippines, Inc.ECP
PSE Disclosure Form 5-1 - Substantial Acquisitions References: SRC Rule 17 (SEC Form 17-C) and Section 4.4 and/or Section 5 of the Revised Disclosure Rules
Subject of the Disclosure
Easycall Communications Philippines, Inc. (ECP) to acquire 100% of the total issued and outstanding shares of Transnational E-Business Solutions, Inc. (TESI)
Background/Description of the Disclosure
At the regular meeting held on 2021 December 02, the Board of Directors unanimously approved the following:
(1) The acquisition of 1,000,000 common shares of Transnational E-Business Solutions, Inc. (“TESI”) based on the book value of TESI as of 2021 June 30 interim audited financial statement in the amount of P162,925,694.00 or P162.925694 per share, resulting in ECP acquiring 100% of TESI. TESI is engaged in the business of Information Technology (IT) services, including software development, software as a service and information technology outsourcing, among others. The acquisition of TESI will further enhance the products and service offerings of ECP as a technology company. TESI is owned 50% by Transnational Diversified Corporation (“TDC”) and 50% by TDG Ventures, Inc. (“TVI”) while ECP is 88.03% owned by TVI. A related parties transaction report will be filed by ECP once the sale transaction is concluded which is scheduled early next year.
(2) Funding for the acquisition will be sourced from bank loans and shareholder advances.
Date of Approval by Board of Directors
Dec 2, 2021
Date of Approval by Stockholders
N/A
Other Relevant Regulatory Agency, if applicable
N/A
Date of Approval by Relevant Regulatory Agency
N/A
Rationale for the transaction including the benefits which are expected to be accrued to the Issuer as a result of the transaction
TESI is a company that has enabled businesses to fast track their digital adoption through systems development using low-code applications, software as a service (“SAAS”), and information technology outsourcing (“ITO”) among others, and would strengthen further ECP’s capabilities as a technology company. Year to date, TESI is EBITDA and Net Income positive.
Description of the transaction including the timetable for implementation and related regulatory requirements, if any
ECP will acquire 100% of TESI through the purchase of 1,000,000 common shares based on the book value of TESI as of 2021 June 30 interim audited financial statement in the amount of P162,925,694.00 or P162.925694 per share. The sale transaction is scheduled to be concluded early next year once ECP completes sourcing the funds for the acquisition. After the execution of the sale documents, TDC and TVI will pay capital gains tax and ECP will pay documentary stamp tax for the transaction.
Identities of the parties to the transaction
Name
Nature of Business
Nature of any material relationship with the Issuer, their directors/officers or any of their affiliates
Transnational Diversified Corporation (“TDC”)
Holding Company
TDC exercises control over the issuer through TDC’s 88.24% ownership of TVI and has common directors and officers with ECP
TDG Ventures, Inc. (“TVI”)
Information Technology (IT) services
TVI owns 88.03% of the issuer and has common directors and officers with ECP
Transnational E-Business Solutions, Inc. (“TESI”)
Information Technology (IT) services
TESI is an affiliate of the issuer with TVI and TDC each owning 50% of TESI and has common directors and officers with ECP
Terms and conditions of the transaction
The nature and amount of consideration (e.g. price per share, the aggregate amount)
Aggregate amount – P162,925,694.00 based on the 2021 June 30 interim audited financial statement of TESI Price per share – P162.925694
Basis upon which the amount of consideration or value of the transaction was determined
The amount of consideration or value is based on the Book Value of TESI based on the pooling of interest approach since TESI and ECP are under common control of TDC directly and through TVI.
The number of shares to be acquired
1,000,000 common shares
Ratio/percentage to total outstanding capital stock
100
Terms of payment
Full payment upon execution of the Deed of Absolute Sale
Conditions precedent to closing of the transaction, if any
Drawdown from ECP bank loan and/or shareholder advances for the full payment of acquisition
Description of the company subject of the transaction
Nature and business
TESI is engaged in the business of Information Technology (IT) services
Discussion of major projects and investments
TESI has three major lines of businesses under software development using low-code applications to fast track the digital adoption of companies, software as a service and information technology outsourcing.
List of subsidiaries and affiliates, with percentage holdings
Name
% Ownership
TESI has no subsidiaries and its affiliates are companies owned by TDC and TVI including ECP
Effect(s)/impact on the business, financial condition and operations of the Issuer
The acquisition of TESI will enhance ECP’s thrust as a technology company as it complements ECP’s current services on connectivity, data and technology services. The acquisition of TESI will add to the overall business scale and capabilities of ECP group.
Other Relevant Information
Copies of the interim audited financial statements as of 2021 June 30 and General Information Sheet of TESI are attached.
Filed on behalf by:
Name
Patricia Marcelo
Designation
Deputy General Manager / Assistant Investor Relations Officer
EasyCall Communications Philippines, Inc.ECP