Amid sluggish market conditions, local software firm Gurango Software Corp. (GSC) has pushed back its planned initial public offering (IPO) to 2010 and will instead undertake a private placement of shares to raise about $5 million.
In a briefing with reporters following a forum sponsored by the Business Process Association of the Philippines and Outsource2Philippines Inc. yesterday, GSC chief executive officer Joey Gurango said the company is now in talks with several investors which have expressed interest to subscribe to the private placement of shares and expects fresh equity to be raised in 90 days.
GSC, which develops and distributes products for the Microsoft Dynamics ecosystem, was earlier looking at raising P300 million through an IPO this year to accelerate its expansion in major markets abroad.
“We have reassessed the situation and we decided to push back the IPO due to unfavorable economic conditions. However, we are in the process of raising private equity to fund our expansion overseas,” Gurango said.
He said the money that will be raised from the private placement will be used to bankroll GSC’s expansion in China and the Middle East which are considered high prospects for growth.
He said the company is planning to enter China either through acquisitions or the establishment of a facility or representative office there. If plans push through, GSC will become the first Filipino software firm in China.
Gurango earlier said the company was looking at a dozen foreign companies for possible acquisitions particularly intellectual property assets that complement its product portfolio and those whose distribution channels have an international customer base.