PhilWeb gets 30% stake in JKS Tech

PhilWeb Corp. is acquiring a 30-percent strategic stake in JKS Tech Solutions Inc. for about P4.23 billion, giving the listed technology firm foothold in a profitable business-to-business (B2B) digital infrastructure company.

On Wednesday, PhilWeb said it had executed definitive agreements for the investment in JKS, a technology, platform and digital infrastructure company serving licensed midmarket operators in the digital entertainment sector.

The transaction will not rely on new external debt financing. Instead, PhilWeb will partly fund the investment by monetizing shares from its existing treasury stock.

Under the deal, PhilWeb will sell 81.38 million treasury shares to JKS at P16.50 each, raising about P1.34 billion.

The proceeds will be redeployed toward the investment. PhilWeb said the move would also help strengthen its equity position and capital structure. The acquisition is also expected to give PhilWeb access to an established earnings stream.

Based on unaudited management accounts, JKS generates about $35 million in annual net income from its recurring B2B operations.

PhilWeb expects its stake to contribute meaningfully to future earnings, although the actual impact will depend on JKS’ operating performance and the applicable accounting treatment. “JKS combines an established earnings base with a scalable, asset-light B2B operating model and a highly complementary market position,” PhilWeb chair Lance Gokongwei said.

PhilWeb sees opportunities to integrate selected backend systems, platform infrastructure, monitoring tools, data capabilities and operational technologies between the two companies.

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It also expects potential efficiencies in customer service, technical support, compliance, risk management and reporting.

The expanded network is likewise seen to support PhilWeb’s artificial intelligence-enabled technology roadmap, including real-time operational monitoring, algorithmic risk management, regulatory compliance automation and antifraud detection.

PhilWeb currently has relationships with licensed operators and integrated resorts such as Okada Manila, Hann Casino Resort, Newport World Resorts and Nustar Resort and Casino.