Online gaming company DigiPlus Interactive Corp. announced Thursday it has met the second set of conditions under its subscription agreement with Hong Kong-listed International Entertainment Corp. (IEC), moving forward with a major expansion plan.
Back in March, the firm already satisfied the first requirement and received convertible notes worth HK$0.8 billion from the arrangement. The full agreement covers HK$1.6 billion—roughly P12 billion—in five-year convertible notes carrying a 3 percent annual interest. The deal gives DigiPlus the right to take a 53.89 percent economic share in IEC. If the company opts not to convert the notes into ownership, the instruments may be redeemed at 108 percent of their value when they mature.
DigiPlus holds more than P19 billion in cash and may also use bank loans to fund part of the transaction, according to former president Andy Tsui. He explained that acquiring IEC would strengthen the firm’s presence in the Philippine mass gaming market, notably through the New World Hotel Manila property located in central Manila.
Management believes the Malate area offers better growth prospects compared to Entertainment City, where competition is fierce and expansion has slowed. Setting up in Malate also involves far lower investment costs: building a full integrated resort in Entertainment City typically costs at least $1 billion, while entering the Malate market through IEC requires much less capital and grants majority control.
The company is currently working with legal advisers to secure a “whitewash waiver,” which would let it complete the purchase without being required to make a takeover offer to all other IEC shareholders.
This transaction positions DigiPlus to diversify from online operations into land-based gaming at a lower cost, targeting underserved markets in Manila, while leveraging strong cash reserves to fund growth amid a shifting competitive landscape.
