Cashrounds to expand IT platform

Publicly-listed Cashrounds plans to expand its existing information technology platform in order to introduce related products and services and integrate wireless communications technology.

Cashrounds earlier entered into a memorandum of agreement with digital trunk radio company Next Mobile Inc. (NMI) and five other companies namely Top Mega Enterprises, Joycelink Holdings, Gamboa Holdings, Emerald Investments and Food Camp Industries which are the shareholders of NMI to swap shares of stocks.

Cashrounds will issue new shares in exchange for the NMI shares held by the five companies, as a result of which NMI shareholders will gain control of Cashrounds while the latter will become the controlling shareholder of NMI.

The share swap shall be subject to approval of the National Telecommunications Commission, the Securities and Exchange Commission for the increase in capital stocks and other regulatory clearances to effect the listing of the shares after the closing date on July 31.

For purposes of the intended share swap, the NMI shares held by the five companies that will constitute 97 percent of the issued and outstanding capital stock of NMI on closing date shall have a value of P6.58 billion while that of Cashrounds shall be P28 million.

Cashrounds is also changing its primary purposes, from being an online matchmaker to engaging in the business of providing information communications technology (ICT) services including development and delivery of media content, IT, applications and communications technology infrastructure.

Before the actual swap of shares with NMI, Cashrounds will change its name to Information Capital Technology Ventures (ICTV).

Cashrounds will also be increasing its authorized capital stock from P40 million to P7 billion of which P6.6 billion will be listed and issued and outstanding. The par value per share will remain at P1.

NMI is the country’s first and only fully integrated digital wireless operator that integrates four types of communications services: Digital two-way radio, digital mobile telephone, data services and messaging, utilizing a transmission technology called iDEN (integrated digital enhanced network) technology developed by Motorola.

Under its five-year plan, NMI will upgrade its switch in preparation for the planned international push-to-talk services to the US and other countries. It also intends to expand the coverage of its network to other key commercial areas in the Philippines. It has already started with Baguio and will soon include Cebu and Davao.

NMI said it intends to fund its network upgrade and expansion through a combination of equity, mainly from new investors, and debt.

According to NMI, just as the company evolved from a paging company to a two-way communications system and subsequently added messaging and data services when the market demand built up, it is now seeing the next evolution from plain communication into an integrated productivity tool, where access to and processing of information in the field is becoming increasingly necessary.

To serve these needs, NMI is diversifying into advanced and customized data/information services. This move, the company said, increases recurring revenues but more importantly improves customer loyalty or "stickiness" and gives the company access to entirely new market segments. NMI has branded all these services under the name IMX Telematics.

To support these services, NMI moved away from an outsourced setup to establish its own packet data operations center and hub in Manila middle of last year. This enabled the company to offer competitive and advanced mobile data services with the added feature that they can be customized to the customers’ operations.

Company officials said a number of such applications are already in service, with its location-based services using GPS positioning expected to face a strong demand in the near future.