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IPVG Corp. disclosed to the Philippine Stock Exchange
that it is no longer pursuing its plan to acquire People Support Inc
after the Nasdaq-listed business process outsourcing (BPO) company
rejected the Filipino firm’s overtures.
People Support, which operates
largely from the Philippines, earlier rejected IPVG’s sweetened
offer, raising concern over how the Filipino firm and its partner,
AO Capital Partners Ltd., would finance their buyout of the
US-headquartered BPO company given the acquirer’s P3.4-billion
market capitalization and P1.4 billion in assets.
IPVG and AO Capital proposed to
buy People Support for $17 a share, raising the offer from $15
previously, on January 29, when the BPO company’s stock closed at
$12.51 a share.
IPVG had requested a
nondisclosure agreement that contains provisions that would allow
for a two-way exchange of information, the removal of measures
People Support had instituted to discourage a hostile takeover, as
well as a break-away fee.
The Filipino firm said it, along
with its partner, “were prepared to disclose investment and
financing structure” with People Support’s management upon the
signing of the proposed agreement. However, the US-based company
rejected the proposal nonetheless. After they were spurned, IPVG,
through its chief executive Enrique Y. Gonzalez, wrote Lance
Rosenzweig, People Support chairman, on February 6 to inform the BPO
company that the offer had been withdrawn.
To support the proposed
acquisition, IPVG partnered with AO Capital to create a special
purpose vehicle and both companies agreed that they would raise
capital through debt and equity to fund the purchase.
--Likha C. Cuevas-Miel
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