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)
Feb 26, 2015
2. SEC Identification Number
A200117708
3. BIR Tax Identification No.
219-934-330
4. Exact name of issuer as specified in its charter
Xurpas Inc.
5. Province, country or other jurisdiction of incorporation
Philippines
6. Industry Classification Code(SEC Use Only)
7. Address of principal office
7F Cambridge Centre, 108 Tordesillas St., Salcedo Village, Makati City Postal Code1227
8. Issuer's telephone number, including area code
(632) 889-6426
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
1,720,000,660
11. Indicate the item numbers reported herein
Item 2
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.
Xurpas Inc.X
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
Xurpas Inc. ("Xurpas") acquires a 51% controlling stake in Storm Flex Systems, Inc. ("Storm") at US$4.3 million.
Background/Description of the Disclosure
Xurpas and Storm have signed a deal that will give Xurpas 37,565 shares or a 51% stake in Storm and other rights. Storm is a human resource consultancy firm which has developed a proprietary platform called the "flex benefits system" that allows employees to convert their employee benefits to other benefits such as gadgets and dining, a private carpool system, doctor consultations on demand, and even donations for charitable causes.
Date of Approval by Board of Directors
Feb 26, 2015
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
Since inception, Storm has demonstrated truly exponential growth, with revenue increasing five-fold from 2013 to 2014.
The acquisition of Storm will enable Xurpas to expand into an entirely different distribution network, beyond telecommunication networks. Xurpas will be able to reach more customers and provide them with physical products and services through Storm's "flex benefits system."
Storm’s "flex benefits system" is currently used by some of the country’s leading local conglomerates, BPOs, and fast moving consumer growth companies both in Manila and Cebu. Storm targets to tap around 30,000 employees this year, doubling its current 15,000 client-employees. Money raised for the transaction will be used by Storm to accelerate its local operations and branch out to other parts of Southeast Asia.
Since Storm’s clients are able to provide their employees with an effectively wider range of benefits, it is an example of how technology can provide companies an ‘unfair advantage’ in the most unlikely areas such as employee attraction and retention.
Description of the transaction including the timetable for implementation and related regulatory requirements, if any
On February 26, 2015, Xurpas and Storm signed a Memorandum of Agreement for the purchase and sale of 37,565 shares. The closing of the transaction is scheduled once all the required documents have been submitted by Storm.
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
Storm Flex Systems, Inc.
Human Resource Consultancy Firm
Mr. Nico Jose S. Nolledo ("Mr. Nolledo"), President, Chairman and Chief Executive Officer of Xurpas, owns 3,875 shares in Storm and is also a director of the same. Mr. Nolledo
Terms and conditions of the transaction
The nature and amount of consideration (e.g. price per share, the aggregate amount)
Cash in the aggregate amount of US$4,299,314.25 million or Php190,889,552.70 million
Basis upon which the amount of consideration or value of the transaction was determined
Based on the internal due diligence and analysis of the strategic, operational and financial aspects of Storm, the purchase price was determined based on valuation multiples in recent comparable transactions.
The number of shares to be acquired
37,565 common shares
Ratio/percentage to total outstanding capital stock
51
Terms of payment
Full payment will be given upon completion of the transfer of shares in Xurpas' name.
Conditions precedent to closing of the transaction, if any
The submission by Storm of its Audited Financial Statement for 2013
Description of the company subject of the transaction
Nature and business
Storm was incorporated in January 1, 2013 to engage in human resources consultancy. Storm has developed a proprietary platform which allows employees of any company that has signed with Storm to exchange his or her current employee benefits and transform them into benefits ranging from gadgets and dining, a private carpool system, doctor consultations on demand, all the way to donations for charitable causes.
Discussion of major projects and investments
Storm Flexible Benefits System - It is an online proprietary platform that allows employees to convert his or her current employee benefits and transform them into benefits such as gadgets and dining, a private carpool system, doctor consultations on demand, and donations for charitable causes.
List of subsidiaries and affiliates, with percentage holdings
Effect(s)/impact on the business, financial condition and operations of the Issuer
Xurpas will be able to expand into an entirely different distribution network, beyond telecommunication networks, and thus, reach more customers and offer physical products and services. The acquisition is also in line with Xurpas' planned expansion to Southeast Asia, because Storm will use the money raised from the transaction to further expand its services and branch out to other parts of Southeast Asia.
The exponential revenue growth of Storm increasing five-fold from 2013 to 2014 is also expected to contribute to Xurpas' revenues.
Other Relevant Information
The Board unanimously approved the acquisition of 37,565 shares in Storm. Mr. Nolledo and Atty. Mercedita Nolledo abstained from voting to approve the acquisition.
Storm has yet to provide its 2013 Audited Financial Statements. Please see attached 2013 Unaudited Financial Statements of Storm.
Xurpas' book value is approximately P1,440.45 million or P0.84 per share Post IPO.
Xurpas Inc.X