MANILA, Philippines (UPDATED) - A Cebu-based real estate developer is taking over IP Converge Data Center Inc. (CLOUD), after it bought a 79% stake from IP Ventures Inc. (IPVI) and IPVG Employees Inc. (IEI).
In a disclosure to the stock exchange, CLOUD identified the buyer as the "8890 group", which is composed of Januarius Resources Realty Corp., Iholdings Inc and Kwantlen Development Corporation.
"The buy in is expected to result in historical highs both in terms of revenues and net earnings for CLOUD," the company said, in a disclosure to the stock exchange.
However, a company profile of the buyers showed the group was actually named "8990 Group of Companies" after its office address 8990 Building, Negros St., Cebu Business Park, Cebu City.
The group is said to be one of the leading low-cost housing developers in Visayas and Mindanao. At the end of 2011, the group posted revenues of P2 billion. For this year, it expects its total assets to surpass P7.3 billion with net income of P500 million.
The real estate group also announced a mandatory tender offer for minority CLOUD shareholders at P0.9524 per share.
"We have agreed to sell to them 79% of the company at that price. If you look at the structure of the deal, this is an okay deal for majority shareholders, which is our group, but it's a fantastic deal for minority shareholders," IP Ventures chief executive officer Enrique Gonzales told ANC.
"In this situation, the majority shareholders are selling their shares at below market to allow the entry of a large asset and profitable business. The ones who benefit are the minority shareholders because they get to stay on board and ride out the excitement and growth prospects," he added.