Two tech firms controlled by Roberto V. Ongpin, Philweb Corporation (PhilWeb) and ISM Communications Corporation (ISM), will spend P1.3 billion for control over the leading European hotel Internet service provider in a bid to expand the reach of his Internet gaming business.

In a disclosure to the Philippine Stock Exchange, WEB and ISM (through a jointly and equally owned Hong Kong special purpose vehicle) said they have entered into a binding agreement with Global Innovation Partners (GI Partners).

The agreement with GI Partners, a private equity firm based in the United Kingdom (UK), is for the acquisition of a controlling 65 percent stake in Acentic GmbH (Acentic), a limited liability company registered in Germany but headquartered in the UK.

Ongpin, chairman of both WEB and ISM, said that the
acquisition price, which is only slightly over four times EBITDA, is a great bargain for WEB and ISM. The acquisition is scheduled to close on January 11, 2010.

The two local firms were able to win over a number of competing proposals due to the fact that the management of Acentic recognized that WEB and Ism brought substantial value-added to Acentic.

Acentic is an international provider of digital and Internet protocol (IP) converged services to hotels, tourism facilities, healthcare premises as well as to other facilities eligible for its services.

Its digital television (TV) services and high speed Internet access (HSIA) are in 200,000 rooms in many of the world’s leading hotel chains including Accor, Dorint, Intercontinental Hotel Group, Hilton, Hyatt, Maritim, Marriott, Mövenpick and Starwood in more than 30 countries in Europe, Middle East and Africa.

The hotel rooms currently under contract to Acentic and the imminent roll out of Acentic Asia provides WEB with enormous opportunities to expand its gaming business, which is today limited only to the Philippine market, to many other major countries principally in Europe and the Middle East.

WEB will have an instant platform of 200,000 rooms in Europe as a market for its Internet gaming offerings.

The Share Purchase Agreement (SPA) was executed by Host Union International Limited (Host Union) (the Hong Kong special purpose vehicle of WEB and ISM) and LBC Capital S.A.R.L. (LBC) (a Luxembourg company wholly-owned by GI Partners).

ISM will utilize funds it has raised from last January’s P655-million stock rights offering as well as the $10-million private placement made by the Ashmore Group in November 2007 and the remainder of the P300-million stock rights offering conducted in June 2007.