Now Corp to raise P1.4 B to bankroll expansion

MANILA, Philippines - Listed Now Corp. of the Velarde family is set to raise P1.4 billion to bankroll expansion plans particularly for its telecommunications unit to be able to offer text as well as broadband services in Metro Manila and nearby provinces.

The company’s board of directors has approved the doubling of its authorized capital to P2.72 billion from the current P1.32 billion as well as the conversion of advances made by Velarde Inc. into equity and the listing of additional shares from the increase in capital.

Now informed the Securities and Exchange Commission (SEC) and the Philippine Stock Exchange (PSE) that it would engage the services of a financial institution to evaluate the financial services and manage capital market transactions to be undertaken by the company.

Proceeds of the planned fund raising activity would be used to finance various company projects aimed at expanding existing businesses and creating new ones.

Company officials would not elaborate on the particular use of the new funds.

Last June, Now president and CEO Mel Velarde said the company would be earmarking more than P2 billion for the capital expenditures of Now Telecom Co. Inc.

Velarde said the company is spending P1.26 billion over the next two years to activate the all text GSM network of Now Telecom and another P900 million to build its broadband access.

Now Telecom is looking at attracting 2.9 million subscribers over the next five years. It is initially venturing into the text as well as broadband markets and would leave the capital-intensive voice business to industry giants such as dominant carrier Philippine Long Distance Telephone Co. PLDT and Ayala-led Globe Telecom Inc.

Formerly known as Information Capital Technology Ventures Inc. (ICTV), Now is engaged in the business of telecommunications, media (excluding mass media) and technology.

The company was able to cut its net loss to P19.27 million in the first nine months of the year from P42.1 million in the same period last year. Revenues, on the other hand, slipped six percent to P59.4 million from P63.2 million.