SquidPay bust! PHA ditches plan to acquire 33% of Marvin Dela Cruz’s fintech firm

Premiere Horizon Alliance Corp. has abandoned plans to acquire a third of SquidPay Technology Inc. of self-proclaimed fintechpreneur Marvin Dela Cruz due to SPTI’s inability to execute its projects and meet financial commitments.

In a regulatory filing, PHA said its board agreed that the planned purchase of SPTI is no longer in the best interest of the group and its shareholders given the fintech firm’s inability to operate a viable business.

PHA noted that the “planned acquisition of 33% of SPTI was announced on 18 November 2021, at a time when the demand for e-wallets was rapidly rising.”

SPTI was earlier granted an operator of payment system license, followed by an electronic money issuer license.

In the memorandum of agreement (MOA) signed on 29 October 2020, Dela Cruz agreed to buy 55 percent of PHA for P0.33 each share or a total of P925 million.

PHA said that of this amount, P300 million would be paid in cash while the balance of P625 million either through cash or infusion of SPTI shares over a period of two years as provided in the MOA.

“During this period, the parties were to discuss and agree on the manner by which the unpaid subscriptions will be paid. PHA during the past several months had tried to contact and reach out to Mr. Marvin Dela Cruz to discuss the payment of the unpaid subscriptions, to the extent that formal letters were sent out,” PHA said.

PHA pointed out that SPTI has not been able to execute on its planned projects nor attain its objectives, particularly the roll-outs in key cities and partnerships with government agencies.

Apart from this, PHA noted that SPTI “has been embroiled in recent financial troubles that make it clear that SPTI will not add value to PHA”

The Manila Regional Trial Court earlier issued a freeze order on the assets of Dela Cruz and Squidpay due to non-payment of a P100 million loan which was due on June 14. The loan is convertible into shares owned by Dela Cruz in PHA.

PHA said Dela Cruz has also not responded to its requests for meetings to discuss the valuation of SPTI.

It said that out of the total subscription of 2.8 billion shares, Dela Cruz had already fully paid 1.12 billion shares valued at P317.14 million and would just need to pay P553.86 million for the remaining 1.678 billion shares by October 29 to complete the payment as required under their agreement.

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