By Norman P. Aquino and Cecilia Yap
PhilWeb Corp., which operates and manages electronic casinos owned by the Philippine gaming regulator, saw its shares tumble to a 22-month low after the agency said it won’t renew the company’s contract.
“We won’t cancel it but we won’t renew it,” Philippine Amusement and Gaming Corp. chief executive Andrea Domingo said in a mobile-phone message on Monday. The contract expires Aug. 10, she said.
The company’s shares fell 43.1 percent to P5.13 Monday, the lowest close since October 2014. The Philippine Stock Exchange Index rose 0.3 percent. PhilWeb President Dennis Valdes didn’t immediately respond to a call and mobile-phone message seeking comments.
PhilWeb shares have plunged more than 70 percent since the start of July, after President Rodrigo Duterte ordered a stop to online gambling at his first cabinet meeting.
PhilWeb on Sunday said it might need to shut down operations including 286 so-called e-games outlets if its contract with the government gambling regulator was canceled or not renewed.
PhilWeb has been managing the gaming regulator’s e-games network for the past 14 years, remitting P14 billion ($298 million) to the agency for its share of the revenue from the operations, according to the company.
The company has said it doesn’t operate online gaming websites. PhilWeb’s electronic games can’t be accessed by office or home computers and its members-only players must be physically present at the cafes to play, it said.
PhilWeb chairman Roberto Ongpin, who served as trade minister to the late Philippine dictator Ferdinand Marcos, resigned last week after Duterte named him among those he’s targeting for alleged political connections.
Ongpin quit his job “to save the company,” Valdes said in a statement on Sunday.
PhilWeb said in a statement it sent a letter requesting for a meeting with Domingo, the Pagcor chair, to clarify the situation.
“PhilWeb is merely a software provider to Pagcor for its network of e-Games outlets. We are not online gaming. Our software cannot be played from homes or offices,” said Valdes.
Valdes said each e-Games outlet was owned by an individual entrepreneur whose gaming license was issued by Pagcor directly to them. Each e-Games outlet therefore pays all taxes, as does PhilWeb itself.
“The e-Games network contributed a total of P2.1 billion to Pagcor in 2015, and over P14 billion in the past 14 years,” he said.
“We feel that President Duterte may have been misinformed,” said Valdes. “Thus, we are seeking the meeting with Chairperson Domingo so that we may fully explain our side. As a publicly listed company on the Philippine Stock Exchange, our records are fully open to public scrutiny and are available for a full investigation at any time.”
“I sincerely hope that the situation can be clarified. Over 5,000 employees work in the e-Games outlets and it would be heartbreaking to see these people’s livelihoods affected. There are also over 1,500 stockholders in PhilWeb and many of these mom-and-pop investors cannot afford to have their savings wiped out overnight,” Valdes said.