TIDMSYME
RNS Number : 8919G
Supply @ME Capital PLC
30 November 2020
30 November 2020
Supply@ME Capital plc
(The "Company" or "SYME")
Trading Update
Supply@ME Capital plc, the innovative fintech platform which
provides the Inventory Monetisation(c) service to manufacturing and
trading companies, is pleased to provide the following update on
its Inventory funding activities and Client company originations
and new business geographies..
The SYME platform aligns Client companies (manufacturing and
trading companies) seeking to monetise part of their inventory for
cash, with Inventory funders (banks, financial institutions and
investment funds). The Inventory funders invest through the SYME
platform into portfolios of inventory assets through Securitisation
Vehicles.
1. Inventory Funding Programme
SYME has progressed with all three of its funding channels.
i) Open Funding
The first Open Funding transaction is the inventory-backed
securitisation note programme, managed by StormHarbour Securities
LLP.
This securitisation issuance is now in its final phase. During
November, many of the key issuance processes were either completed
or have progressed to their final stages, including:
-- engagement of a specialist inventory analyst to run a final
examination of the inventory before monetisation takes place,
-- extensive work by the legal team Gatti Pavesi Bianchi [1] to
finalise the transaction package,
-- agreements with the Inventory funder have successfully
completed relating to the inventory reporting processes and the
business continuity plan relating to the Platform,
-- design of a new fast-track procedure to accelerate the due
diligence process of Client Companies, which may increase the
number of corporates monetised in the first transaction,
-- the final terms of the note subscription, which are expected
to be agreed in the coming days and will be announced
separately.
The objective of this crucial period of work by all Parties is
to deliver the first transaction and create an entirely new
Inventory Monetisation asset class that reflects best practice
principles established in the securitisation market. It will
therefore be a repeatable and scalable investment product for
subsequent rounds of securitisation.
Upon completion, expected before the Year-end, the Company will
disclose the detail of the securitisation transaction and Inventory
funding partner.
ii) Captive-Funding
As announced on 21 September 2020, the Company entered into a
strategic agreement with a leading European Alternative Investment
Firm ("Financial Partner") and SYME's shareholders, 1AF2 S.r.l. and
The AvantGarde Group S.p.A. ("Co-investors") to acquire a bank in
Europe. The Bank will remain independent of SYME, owned by the
Financial Partner (who has committed to recapitalise it) and the
Co-investors. SYME will not be a shareholder and has no costs
relating to the transaction, it will, however, be the main
beneficiary of the acquisition which will provide funding through
the Platform, via a novel "banking as a service" model.
SYME's objective is to complete the acquisition and
authorisation processes during the first quarter of 2021, such that
inventory funding commitments from the Captive Bank to the Platform
can begin and that the Captive Bank becomes a cornerstone investor
in SYME's wider inventory funding programmes.
The Company will provide details of the Financial Partner and
their market position once the acquisition is sufficiently
advanced, potentially by the end of the year.
Self-Funding
Self-Funding enables banks and other institutions to offer the
Inventory Monetisation service direct to their customers, such that
the banks and their client base can benefit from the systems,
assessment and monitoring processes of SYME's Platform.
The Company continues to work with two Italian Financial
Institutions on self-funding transactions and anticipates further
business synergies between them and the upcoming Captive Bank. More
specifically, one of the two Institutions is developing an
insurance product which could combine the future role of the
Captive Bank and the unique market position of the Inventory
Monetisation Platform.
2. Client Company Origination
The portfolio of Client companies continues to grow and now
includes mid-cap and large-cap businesses from Italy, UK and UAE.
Gross origination of Client companies has increased 16% since
September 2020.
Value (Euro) 31.3.20 30.6.20 30.9.20 30.11.20
Gross origination [2] 1.22bn 1.43bn 1.64bn 1,9bn
-------- -------- -------- ---------
Number of client companies 82 97 142 152
-------- -------- -------- ---------
The partnership with the EPIC platform announced on 7 September
2020 continues to supply a strong pipeline of Client companies. In
addition to the 152 corporates originated by the end of November, a
further 56 Client companies should become eligible to commence the
due diligence phase.
According to the GICS [3] classification adopted by the Company,
the key Portfolio core sectors are currently Materials, Capital
Goods, Retailing and Food, Beverage & Tobacco.
3. New Business Geographies
UK
Notwithstanding the continued uncertainties surrounding Brexit,
the Company is working to make the UK a key hub for its Inventory
Monetisation service as well as a "pivot" for cross-border
monetisation operations (ideal for large corporates with inventory
in a number of global locations).
SYME has new agreements with the following "eco-system
partners":
-- SIA Group [4] , a multi-award-winning asset appraisal,
advisory and disposal company providing a range of solutions to
asset-based lenders, banks, financial sponsors across the UK and
Europe;
-- ALTIMAPA Capital [5] , which helps corporate and financial
clients access capital in non-traditional funding markets. Its
founder, Pedro Tavares, led the Corporate Risk Advisory team at
Nomura, and the Credit Analytics team at Merrill Lynch. He started
his career in quantitative analytics within banking before covering
a variety of roles across structuring and analytics.
In addition, the Company is in the process of agreeing an
on-going collaboration with one of the Big Four [6] that is highly
active in the development of International Financial Reporting
Standards (IFRS) relating to the multi-jurisdictional themes of
Inventory Monetisation, given the expansion of SYME
internationally.
In relation to the Inventory Monetisation programme for UK
companies, SYME has agreed a Heads of Terms with a global asset
manager for an Inventory funding facility with a potential value up
to EUR500m. In accordance with confidentiality agreements signed by
the Parties, the identities of those involved cannot be announced
until additional key milestones have been achieved.
UAE
With the support of the Funding Specialist announced on 3
November 2020, the approval process of the Shari'a compliant
version of the Platform is progressing to plan. SYME and its
advisors have engaged with the Shari'a Scholars, who conduct the
Shari'a appraisal, and have targeted the end of the year for formal
sign-off.
Regarding company sourcing, SYME, together with its Funding
Specialist and local partner iMass, has commenced a dialogue with
government parties with the objective of offering the Inventory
Monetisation process to certain of their sector holding companies
as an add-on to their existing digital warehouse solutions.
US
The Company and The Trade Advisory are progressing with the
development of a first pilot Inventory Monetisation within the
retail sector and are also evaluating an opportunity to deliver an
innovative inventory "in transit" monetisation model.
Commenting on the Update, Alessandro Zamboni, CEO, said:
" We are very pleased with the progress made across all funding
fronts over the past month. The securitisation issuance is now in
its final phase with many of the key processes either completed or
in their final stages and I look forward to announcing its closing.
Furthermore, working closely with the global asset management
industry, the Captive Bank project will provide an additional boost
to our business by supporting the inventory monetisation of our
growing client portfolio.
Notes
Supply@ME enables businesses to generate cashflow, without
incurring debt, by monetising their existing stock. Before a
business has found an end-customer for its inventory, the Supply@ME
platform enables them to sell ("monetise") their stock and receive
cash immediately to boost their working capital. The Supply@ME
service enables strong companies to improve their working capital
cycle. SYME does not monetise inventory for companies in financial
difficulty or with inventory that they are struggling to sell.
Contacts
Alessandro Zamboni, CEO, Supply@ME Capital plc,
investors@supplymecapital.com
Paul Vann, Walbrook PR Limited, +44 (0)20 7933 8780;
paul.vann@walbrookpr.com
Brian Norris, Cicero/AMO, +44 (0)20 7947 5317
[1] www.gblex.it.
[2] "Gross origination" includes all client companies that have
signed an NDA, a term sheet, or are in or have completed the
onboarding process.
[3] www.msci.com/gics.
[4] www.sia-group.co.uk.
[5] www.altimapa.com.
[6] The Big Four is the nickname used to refer collectively to
the four largest professional services networks in the world,
consisting of Deloitte, Ernst & Young, KPMG and PwC.
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