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Friday, September 19, 2008

Alternatives for Equity Funding Available to Support Growth of O&O Companies

To facilitate expansion plans, local offshoring and outsourcing companies have the option of equity funding through initial public offerings and other means, an industry spokesperson said.

“Many O&O companies are planning to expand their operations in the Philippines ,” said Oscar Sañez, chief executive officer of the Business Processing Association of the Philippines.

“And of course any expansion plan requires capital. Equity funding, through IPOs and other means, can be leveraged to support these strategic development initiatives.”

According to a survey BPA/P conducted with Outsource2Philippines, 65 percent of 81 respondents—executives of companies in the local O&O industry—are considering options for equity funding to fuel expansion plans. The majority of respondents hope to generate between PHP100 million to PHP500 million in investment capital, either through private placement, venture capital, initial public offering, or angel investment.

“This data clearly shows that the idea of accessing equity funding is being considered by a significant number of industry players,” said Sañez. “Accelerating growth through equity funding will benefit the industry,” he said.

By 2010, BPA/P’s O&O industry roadmap projects that the Philippines will capture 10 percent of the global O&O market with revenues of US$12 billion. “Naturally, our chances of reaching and exceeding that goal will increase if local services providers expand quickly.” said Sañez. “Equity funding can play a core role in providing the resources to expand.”

BPA/P and O2P, in association with the Philippine Stock Exchange (PSE), will present a senior executive business briefing on equity funding September 18, 2008, from 7:30 am to 10:30 am, at the Makati Shangri-la Hotel. Entitled, “On the Road to Going Public, the forum will focus on equity funding alternatives for companies in the O&O industry. Aside from industry executives, delegates from the finance, legal, and investment sectors are also expected to attend the briefing.

On the Road to Going Public is sponsored by ExcelAsia, ATR KimEng Capital Partners, and TeamAsia. Aside from Sañez, other confirmed speakers for the event include Frank Holz, CEO, O2P; Atty. Francis Lim, president, PSE; Luz Lorenzo, regional economist, ATR-KimEng Securities Inc.; Joey Gurango, chief executive officer, Gurango Software; and Rainerio “Bong” Borja, president, PeopleSupport Philippines Inc.

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