TIDMIME
RNS Number : 8839O
Immediate Acquisition PLC
14 June 2022
This announcement is for information purposes only and does not
constitute or contain any invitation, solicitation, recommendation,
offer or advice to any person to subscribe for, otherwise acquire
or dispose of any securities in Immediate Acquisition Plc or any
other entity in any jurisdiction. Neither this announcement nor the
fact of its distribution shall form the basis of, or be relied on
in connection with, any investment decision in Immediate
Acquisition Plc.
The information contained within this announcement is deemed by
the Company to constitute inside information stipulated under the
Market Abuse Regulation (EU) No. 596/2014 which forms part of
English law by virtue of the European Union (Withdrawal) Act 2018,
as amended. Upon the publication of this announcement via the
Regulatory Information Service, this inside information is now
considered to be in the public domain.
14 June 2022
Immediate Acquisition Plc
("IME" or "the Group" or "the Company")
Proposed Acquisition and
Proposed Placing to raise c.GBP8 million
The Directors of Immediate Acquisition Plc (AIM: IME) are
pleased to announce the proposed acquisition of Fiinu Holdings
Limited ("Fiinu") (the "Proposed Acquisition") for a total
consideration of approximately GBP37.5 million to be satisfied by
the issue of new ordinary shares in the capital of the Company to
the selling shareholders of Fiinu ("Sellers") at a price of 20p per
share ("Consideration Shares"), alongside its intention to raise
approximately GBP8 million, before expenses, by way of a
conditional placing of new ordinary shares in the capital of the
Company at 20p per share (the "Placing"). SP Angel Corporate
Finance LLP is acting as bookrunner in respect of the Placing.
The Proposed Acquisition will constitute a reverse takeover
under the AIM Rules for Companies and will also require a Rule 9
Waiver as a result of the issue of consideration shares to certain
of the Sellers who have been deemed to constitute a Concert Party
for the purposes of the City Code on Takeovers and Mergers. The
Placing and Proposed Acquisition are both subject to shareholder
approval and it is proposed that the enlarged issued share capital
of the Company will be admitted to trading on AIM
("Admission").
About Fiinu:
-- Fiinu, founded in 2017, is a technology platform and provider of consumer banking products.
-- For the year ended 31 March 2021, Fiinu generated no revenue
and recorded an audited loss before taxation of GBP1.19 million. As
at 30 September 2021, Fiinu had unaudited net assets of
approximately GBP0.73 million.
-- Fiinu is comprised of two businesses: Fiinu 2 Ltd (to be
renamed Fiinu Bank Ltd following Admission), which will, prior to
Admission, hold a Banking Licence issued by the Bank of England.
Fiinu 2 Ltd will offer the Fiinu group's flagship product, the
Plugin Overdraft(R). The other Fiinu business is Fiinu Services
Ltd, a provider of financial technology and alternative data
solutions.
-- On 7 June 2022 the Prudential Regulatory Authority, with the
consent of the FCA, issued an 'authorised subject to capital'
letter to Fiinu 2 Ltd.
-- Fiinu's Bank's Plugin Overdraft is a new banking product
which marks the first time an overdraft product has been unbundled
from a current account since the overdraft was first introduced.
Using the Plugin Overdraft(R), Fiinu 2 Ltd will be able provide its
customers with an overdraft facility without them having to switch
their current account with their present bank, giving customers
access to affordable credit. Importantly, an overdraft does not
negatively impact a consumer's credit score and helps avoid
expensive payday lenders, giving consumers the opportunity to build
their credit rating, rather than erode it.
-- Fiinu Services Ltd is the group's technology arm which will
manage and develop the group's platform utilising data insights and
analytics.
Proposed Fundraising:
-- The Placing is being conducted via an accelerated bookbuild,
pursuant to which the Company intends to raise gross proceeds of
approximately GBP8 million. Mark Horrocks, a director of IME, has
indicated that he may participate in the Placing; any such
participation would be a related party transaction under the AIM
Rules.
-- The accelerated bookbuild will be launched immediately following this announcement.
-- The Placing will comprise a placing of approximately 40
million new ordinary shares in the Company ("Placing Shares") at 20
pence per share (the "Placing Price").
-- The Company will also enter into a GBP2.49 million loan
facility agreement (the "Loan Facility") with Dewscope Limited, a
company controlled by Mark Horrocks. The Loan Facility will
constitute a related party transaction under the AIM Rules.
-- Taken together with existing cash held by IME, and subject to
shareholder approval in general meeting, this would provide the
Company and its wider group following completion of the Proposed
Acquisition ("Enlarged Group") with available funding, before
expenses, of approximately GBP14 million.
Other highlights:
-- Proposed change of name to Fiinu Group plc.
-- On completion of the Proposed Acquisition, it is intended
that David Hopton, Chris Sweeney, Philip Tansey, Marko Sjoblom and
Huw Evans will be appointed to the Board. The Board will include
four Independent Non-Executive Directors and three Executive
Directors. Simon Leathers, an existing director of the Company will
remain a director following completion.
-- The Proposed Acquisition, Placing, Waiver of Rule 9 of the
City Code and Change of Name will require shareholder approval at a
general meeting. An Admission Document, Notice of General Meeting
and Form of Proxy will be posted to IME shareholders in due
course.
Further announcements will be made as appropriate.
Tim Hipperson, Non-executive Chairman of IME, commented:
"As a Board, we have looked at and appraised a number of
opportunities in the technology and fintech sector and Fiinu stood
out when it came to a product in a market with incredibly high
barriers to entry and its consumer-focused operating model which
improves financial inclusion.
"Many people assume that everyone has on overdraft - they do
not. This is in the main due to regulatory changes which in effect
led to the disappearance of unarranged overdrafts. With its
proprietary product, the Plugin Overdraft(R), Fiinu will be the
first company to be able to unbundle an overdraft facility from a
primary current account."
For further information please contact:
Immediate Acquisition Plc Tel: +44 (0) 203 515 0233
Tim Hipperson, Non-executive Chairman
Simon Leathers, Non-executive Director
SPARK Advisory Partners Limited (Nomad) Tel: +44 (0) 203 368 3550
Mark Brady
Neil Baldwin
SP Angel Corporate Finance LLP (Broker) Tel: +44 (0) 207 470 0470
Abigail Wayne
Matthew Johnson
Buchanan Communications Tel: +44 (0) 207 466 5000
Chris Lane / Kim van Beeck
Forward Looking Statements
Certain statements made in this announcement are forward-looking
statements. These forward-looking statements are not historical
facts but rather are based on the Company's current expectations,
estimates, and projections about its industry; its beliefs; and
assumptions. Words such as 'anticipates,' 'expects,' 'intends,'
'plans,' 'believes,' 'seeks,' 'estimates,' and similar expressions
are intended to identify forward-looking statements. These
statements are not guarantees of future performance and are subject
to known and unknown risks, uncertainties, and other factors, some
of which are beyond the Company's control, are difficult to
predict, and could cause actual results to differ materially from
those expressed or forecasted in the forward-looking statements.
The Company cautions shareholders and prospective shareholder
holders not to place undue reliance on these forward-looking
statements, which reflect the view of the Company only as of the
date of this announcement. The forward-looking statements made in
this announcement relate only to events as of the date on which the
statements are made. The Company will not undertake any obligation
to release publicly any revisions or updates to these
forward-looking statements to reflect events, circumstances, or
unanticipated events occurring after the date of this announcement
except as required by law or by any appropriate regulatory
authority.
Important notices
The distribution of this Announcement and any other
documentation associated with the Placing into jurisdictions other
than the United Kingdom may be restricted by law. Persons into
whose possession these documents come should inform themselves
about and observe any such restrictions. Any failure to comply with
these restrictions may constitute a violation of the securities
laws or regulations of any such jurisdiction. In particular, such
documents should not be distributed, forwarded to or transmitted,
directly or indirectly, in whole or in part, in, into or from the
United States, Australia, Canada, Japan or the Republic of South
Africa or any other jurisdiction where to do so may constitute a
violation of the securities laws or regulations of any such
jurisdiction (each a "Restricted Jurisdiction").
The Placing Shares have not been and will not be registered
under the US Securities Act 1933 (as amended) (the "US Securities
Act") or with any securities regulatory authority of any state or
other jurisdiction of the United States and, accordingly, may not
be offered, sold, resold, taken up, transferred, delivered or
distributed, directly or indirectly, within the United States
except in reliance on an exemption from the registration
requirements of the US Securities Act and in compliance with any
applicable securities laws of any state or other jurisdiction of
the United States.
There will be no public offer of the Placing Shares in the
United States. The Placing Shares are being offered and sold
outside the US in reliance on Regulation S under the US Securities
Act. The Placing Shares and the Consideration Shares (together,
"New Ordinary Shares") have not been approved or disapproved by the
US Securities and Exchange Commission, any state securities
commission in the US or any other US regulatory authority, nor have
any of the foregoing authorities passed upon or endorsed the merits
of the offering of the Placing Shares or the accuracy or adequacy
of this Announcement. Any representation to the contrary is a
criminal offence in the US.
The Placing Shares have not been and will not be registered
under the relevant laws of any state, province or territory of any
Restricted Jurisdiction and may not be offered, sold, resold, taken
up, transferred, delivered or distributed, directly or indirectly,
within any Restricted Jurisdiction except pursuant to an applicable
exemption from registration requirements. There will be no public
offer of New Ordinary Shares in Australia, Canada, Japan, or the
Republic of South Africa.
This Announcement is for information purposes only and does not
constitute or form part of any offer to issue or sell, or the
solicitation of an offer to acquire, purchase or subscribe for, any
securities in any jurisdiction and should not be relied upon in
connection with any decision to subscribe for or acquire any of the
Placing Shares. In particular, this Announcement does not
constitute or form part of any offer to issue or sell, or the
solicitation of an offer to acquire, purchase or subscribe for, any
securities in the United States.
This Announcement has been issued by, and is the sole
responsibility of, the Company. No person has been authorised to
give any information or to make any representations other than
those contained in this Announcement and, if given or made, such
information or representations must not be relied on as having been
authorised by the Company or SPARK or SP Angel. Subject to the AIM
Rules for Companies, the issue of this Announcement shall not, in
any circumstances, create any implication that there has been no
change in the affairs of the Company since the date of this
Announcement or that the information contained in it is correct at
any subsequent date.
SPARK Advisory Partners Limited ("SPARK") which is authorised
and regulated in the UK by the Financial Conduct Authority ("FCA"),
is acting as nominated adviser to the Company. SPARK will not be
acting for or otherwise be responsible to any person (including a
recipient of this Announcement) other than the Company for
providing the protections afforded to its customers or for advising
any other person on the contents of any part of this Announcement
or otherwise in respect of the Proposed Acquisition, Placing or
Admission or any transaction, matter or engagement referred to in
this Announcement. The responsibilities of SPARK, as the Company's
nominated adviser under the AIM Rules, are owed solely to London
Stock Exchange plc and are not owed to the Company or any Existing
Director, Proposed Director or Shareholder or to any other person.
In respect of any decision to acquire Ordinary Shares in reliance
on any part of this Announcement or otherwise, SPARK is not making
any representation or warranty, express or implied, as to the
contents of this Announcement.
SP Angel Corporate Finance LLP ("SP Angel"), which is authorised
and regulated in the UK by the FCA and is a member of the London
Stock Exchange, is acting as broker to the Company. SP Angel will
not be responsible to any person other than the Company for
providing the protections afforded to its customers or for advising
any other person on the contents of any part of this Announcement
or otherwise in respect of the Proposed Acquisition, Placing or
Admission or any transaction, matter or engagement referred to in
this Announcement. The responsibilities of SP Angel as the
Company's broker under the AIM Rules are owed solely to London
Stock Exchange plc and are not owed to the Company or any Existing
Director, Proposed Director or Shareholder or to any other person.
In respect of any decision to acquire Ordinary Shares in reliance
on any part of this Announcement or otherwise, SP Angel is not
making any representation or warranty, express or implied, as to
the contents of this Announcement.
Apart from the responsibilities and liabilities, if any, which
may be imposed on SPARK or SP Angel by the Financial Services and
Markets Act 2000, as amended or the regulatory regime established
thereunder, neither SPARK nor SP Angel accepts any responsibility
whatsoever for the contents of this Announcement, and makes no
representation or warranty, express or implied, for the contents of
this Announcement, including its accuracy, completeness or
verification, or for any other statement made or purported to be
made by it, or on its behalf, in connection with the Company or the
Placing Shares or the Placing, and nothing in this Announcement is
or shall be relied upon as, a promise or representation in this
respect whether as to the past or future. SPARK and SP Angel
accordingly disclaim to the fullest extent permitted by law all and
any liability whether arising in tort, contract or otherwise (save
as referred to above) which it might otherwise have in respect of
this Announcement or any such statement.
No statement in this Announcement is intended to be a profit
forecast or profit estimate for any period and no statement in this
Announcement should be interpreted to mean that earnings or
earnings per share of the Company for the current or future
financial years would necessarily match or exceed the historical
published earnings or earnings per share of the Company.
This Announcement may include statements that are, or may be
deemed to be, "forward-looking statements". These forward-looking
statements can be identified by the use of forward-looking
terminology, including the terms "believes", "estimates", "plans",
"projects", "anticipates", "expects", "intends", "may", "will", or
"should" or, in each case, their negative or other variations or
comparable terminology. These forward-looking statements include
matters that are not historical facts. They appear in a number of
places throughout this Announcement and include statements
regarding the Directors' current intentions, beliefs or
expectations concerning, among other things, the Company's results
of operations, financial condition, liquidity, prospects, growth,
strategies and the Company's markets. By their nature,
forward-looking statements involve risk and uncertainty because
they relate to future events and circumstances. Actual results and
developments could differ materially from those expressed or
implied by the forward-looking statements. Forward-looking
statements may and often do differ materially from actual results.
Any forward-looking statements in this Announcement are based on
certain factors and assumptions, including the Directors' current
view with respect to future events and are subject to risks
relating to future events and other risks, uncertainties and
assumptions relating to the Company's operations, results of
operations, growth strategy and liquidity. Whilst the Directors
consider these assumptions to be reasonable based upon information
currently available, they may prove to be incorrect. Save as
required by applicable law or by the AIM Rules for Companies, the
Company undertakes no obligation to release publicly the results of
any revisions to any forward-looking statements in this
Announcement that may occur due to any change in the Directors'
expectations or to reflect events or circumstances after the date
of this Announcement.
Information to Distributors
UK product governance
Solely for the purposes of the product governance requirements
contained within of Chapter 3 of the FCA Handbook Production
Intervention and Product Governance Sourcebook (the "UK Product
Governance Requirements"), and disclaiming all and any liability,
whether arising in tort, contract or otherwise, which any
"manufacturer" (for the purposes of the UK Product Governance
Requirements) may otherwise have with respect thereto, the Placing
Shares have been subject to a product approval process, which has
determined that such securities are: (i) compatible with an end
target market of investors who meet the criteria of retail
investors and investors who meet the criteria of professional
clients and eligible counterparties, each as defined in paragraph 3
of the FCA Handbook Conduct of Business Sourcebook; and (ii)
eligible for distribution through all distribution channels (the
"Target Market Assessment"). Notwithstanding the Target Market
Assessment, distributors (for the purposes of UK Product Governance
Requirements) should note that: (a) the price of the Placing Shares
may decline and investors could lose all or part of their
investment; (b) the Placing Shares offer no guaranteed income and
no capital protection; and (c) an investment in the Placing Shares
is compatible only with investors who do not need a guaranteed
income or capital protection, who (either alone or in conjunction
with an appropriate financial or other adviser) are capable of
evaluating the merits and risks of such an investment and who have
sufficient resources to be able to bear any losses that may result
therefrom. The Target Market Assessment is without prejudice to the
requirements of any contractual, legal or regulatory selling
restrictions in relation to the Placing. Furthermore, it is noted
that, notwithstanding the Target Market Assessment, SP Angel will
only procure investors who meet the criteria of professional
clients and eligible counterparties.
For the avoidance of doubt, the Target Market Assessment does
not constitute: (a) an assessment of suitability or appropriateness
for the purposes of Chapter 9A or 10A respectively of the FCA
Handbook Conduct of Business Sourcebook; or (b) a recommendation to
any investor or group of investors to invest in, or purchase, or
take any other action whatsoever with respect to the Placing
Shares.
Each distributor is responsible for undertaking its own target
market assessment in respect of the Placing Shares and determining
appropriate distribution channels.
Neither the content of the Company's website nor any website
accessible by hyperlinks to the Company's website is incorporated
in, or forms part of, this Announcement.
Certain figures contained in this Announcement, including
financial information, have been subject to rounding adjustments.
Accordingly, in certain instances, the sum or percentage change of
the numbers contained in this Announcement may not conform exactly
with the total figure given.
All references to time in this Announcement are to London time,
unless otherwise stated.
BACKGROUND TO AND REASONS FOR THE ACQUISITION
In August 2021, Fiinu and the Company signed a non-binding heads
of agreement for the Company to acquire Fiinu Holdings Limited and
its 100% owned subsidiaries, Fiinu 2 Limited and Fiinu Services
Limited. The key reason for the acquisition is Fiinu's future
potential as an innovative fintech group which will, prior to
Admission, hold a banking licence issued by the Bank of England.
The Company considers that Fiinu has a customer-centric operating
model which improves financial inclusion, a strong leadership team
with experience, alternative data analytics and insights vision and
a forward-looking approach to bringing to the market potentially
revolutionary products and services enabled by open banking.
Open Banking, in summary, allows connections between different
banks, third parties and service providers to enable them to simply
and securely exchange data which is aimed at benefitting
customers.
The Directors are confident that the leadership team can execute
its plan and bring increased long-term value to new investors and
current shareholders. The Company believes in Fiinu's vision in
which Open Banking increases competition and innovation in UK
banking.
PRINCIPAL TERMS OF THE ACQUISITION
The Company will enter into two share purchase agreements (the
"Main Acquisition Agreement" and the "Minority Acquisition
Agreement") pursuant to which it will conditionally agree to
acquire the entire issued share capital of Fiinu, for an aggregate
total consideration of approximately GBP37.5 million, to be
satisfied by the issue of the Consideration Shares at the Placing
Price to the Sellers. The Main Acquisition Agreement is
conditional, amongst other things, on the passing of the
Resolutions at the IME General Meeting, the granting of the
required approvals and confirmations from the PRA and the FCA in
respect of the confirmation of the Banking Licence ("Regulatory
Approvals") and the Placing and Admission becoming effective on or
before 9 July 2022. In the Main Acquisition Agreement, the Company
and Dr Marko Sjoblom have given customary warranties to each other.
The remaining Sellers who are a party to the Main Acquisition
Agreement will provide customary fundamental warranties to the
Company. The Minority Acquisition Agreement is conditional on
completion of the Main Acquisition Agreement and the Sellers who
are a party to the Minority Acquisition Agreement will provide
customary fundamental warranties to the Company.
Any Sellers who do not sign the Main Acquisition Agreement or
the Minority Acquisition Agreement will transfer their shares in
Fiinu to the Company, at the same price, on completion of the
Acquisition pursuant to the "drag along" provisions set out in
Fiinu's articles of association.
FINTECH MARKET OPPORTUNITY FOR THE ENLARGED GROUP
Fiinu 2 (to be renamed Fiinu Bank Limited at Admission)
Nearly two-thirds (62%) of the UK adult population with a PCA
used some form of overdraft in 2019. In April 2020, the FCA imposed
new overdraft rules which resulted in an estimated 16.5 million
adults losing access to a form of overdraft in 2020, namely
unarranged overdrafts. The loss of access to unarranged overdrafts
has resulted in a more than GBP10 billion funding gap in the GBP300
billion unsecured lending market.
Fiinu's flagship product is the Plugin Overdraft, a personal
finance management app which is trademarked in the United Kingdom,
European Union and the United States (US application pending). When
confirmed by the Prudential Regulation Authority ("PRA"), the
Banking Licence will allow Fiinu to promote overdraft products and
provide Financial Services Compensation Scheme guaranteed deposits
in the UK, guaranteed for up to GBP85,000. The word 'overdraft',
like the word 'bank', is a protected and restricted expression in
financial legislation. The Banking Licence will therefore form the
foundation for Fiinu's business because only banks can offer
overdrafts. Subject to the conditions under the Banking Licence
being met, the Banking Licence will also allow Fiinu to scale its
lending through an ability to fund its loan book with affordable
and stable access to retail deposits.
Fiinu intends to initially source all of its deposits through
deposit aggregators, including Flagstone Investment Management
Limited and Raisin Platforms Limited, which are platforms that
allow consumers to spread their money across multiple accounts with
different banks. Fiinu will not require its overdraft customers to
switch their bank account to Fiinu or to pay a minimum amount per
month into their Fiinu current account to qualify for an overdraft.
In fact, it is expected that most customers will continue to use
their current debit card, and other services, from their current
bank account as before without any changes. Fiinu will provide a
plugin third-party bank overdraft facility. Fiinu's risk appetite
is to provide overdraft limits for up to GBP1,500 to any qualifying
UK bank account. The use of an overdraft is more common than people
generally think and through the Open Banking-enabled use of
technology, Fiinu can extend the use of the product further.
FCA data suggests that over the last four years, the number of
personal current accounts in the UK has increased by 15%, from 87
million to over 100 million. This means that, on average, each
adult in the UK now has approximately 1.9 current accounts. The
majority of these accounts, 55 million (FCA, 2018) do not have
access to arranged overdrafts at all. This is predominantly caused
by the underlying risk-based underwriting principle and methods
which are based on the Probability of Default ("PD"). The
prevailing methods are also driving the incumbent banks to tighten
their lending criteria in the aftermath of the global
COVID-pandemic and possible economic downturn. The PD model is a
mature underwriting approach that is ideally suited for the secured
lending markets. However, it is a sub-optimal method for unbundled
overdrafts as empirical data suggests that, in most cases, the PD
model results in a binary decision, on pre-determined one-size fits
for all overdraft limits, resulting in the majority of potential
customers being rejected. On the other hand, the principles of
Fiinu's Open Banking-led underwriting models are different to these
traditional methods. Fiinu 2 will be able to adopt a sophisticated
approach to assess affordability and to set credit limits, thereby
potentially enabling it to extend its overdraft credit to a
substantially wider population than traditional banks. Fiinu's
borrowing long and lending short business model could result in a
Net Interest Margin ("NIM") for the bank of over ten percent net
which is considerably higher than UK, US and world banking averages
of 1.3%, 3% and 3.8% respectively.
Fiinu Services Limited
Fiinu Services may be able to drive secondary revenue streams by
licensing the Group's intellectual property rights. Once the
platform is operational, Fiinu Services will analyse transactional
banking data, which is invaluable to learning and understanding
granular consumer behaviour, which would allow Fiinu to analyse and
package the data for a variety of data insights. The Enlarged Group
would establish the platform during the mobilisation period and
such secondary revenues would only be available to Fiinu Services
once it has exited mobilisation. Fiinu aims to become a leader in
servicing the plugin market, whilst improving financial inclusion
and providing depositors and investors with attractive returns. The
Group will be subject to customer consent requirements and data
protection regulations.
Overseas Markets
Whilst Fiinu does not currently have plans for an American or
European roll-out, there may be future opportunities because Open
Banking APIs (software which allows applications to communicate
with each other) have been fully implemented across Europe. The
Fiinu Plugin Overdraft(R) could theoretically be made available to
450 million European Union nationals through thousands of banks
which have adopted standardised Open Banking APIs. As in the UK,
Fiinu would not need other banks' consent or permission to provide
their customers with a plug-in overdraft as this is a
customer-controlled choice.
CURRENT TRADING AND FUTURE PROSPECTS OF THE ENLARGED GROUP
Immediate Acquisition Plc and AIM Rule 15
On 9 May 2022, the Company disposed of its main trading
subsidiary, Immedia Broadcast Limited. The Company was renamed
Immediate Acquisition Plc and became an AIM Rule 15 cash shell and,
as such, is required to make an acquisition or acquisitions which
constitute(s) a reverse takeover under AIM Rule 14 (including
seeking re-admission as an investing company (as defined under the
AIM Rules)) on or before the date falling six months from
completion or be re-admitted to trading on AIM as an investing
company under the AIM Rules (which requires the raising of at least
GBP6 million), failing which the Company's Ordinary Shares would
then be suspended from trading on AIM pursuant to AIM Rule 40.
Admission to trading on AIM would be cancelled six months from the
date of suspension should the reason for the suspension not be
rectified during that period.
Any failure in completing an acquisition or acquisitions which
constitute(s) a reverse takeover under AIM Rule 14, including
seeking re-admission as an investing company (as defined under the
AIM Rules), will result in the cancellation of the Company's
Ordinary Shares from trading on AIM.
Fiinu - initial operations to be commenced following the
confirmation of the Banking Licence
On 7 June 2022, the PRA and the FCA issued a joint 'authorised
subject to capital' letter for Fiinu 2.
Following the approval of the Proposed Acquisition at the
General Meeting, the Company and Fiinu Holdings will immediately
provide the necessary evidence to the PRA and the FCA to prove that
the required capital is in place and available to the licensed
entity, Fiinu 2 Limited, which will be evidenced through the
availability of the Company's existing cash resources and,
following Admission, the net proceeds of the Placing. Additionally,
the Company and Fiinu Holdings will complete the necessary UK CRR
and UK Holding Company application forms for the Company to be
approved by the PRA and the FCA as a UK "parent financial holding
company" in respect of the Enlarged Group in accordance with the UK
CRR. The draft documentation and application has been reviewed by
the PRA and the FCA prior to the publication of this document.
Admission will take place, and the Acquisition will complete,
following receipt of the Regulatory Approvals in writing. Further
details of the 'authorised subject to capital' letter, the Banking
Licence, the restrictions and the applicable banking regime are set
out in Part VI of this Admission Document: Regulation of the
Enlarged Group. During the first half of the 12-month mobilisation
period, which will commence following completion of the Acquisition
and Admission, the Enlarged Group will complete, test, and
externally audit its bespoke technology stack for operational
resilience. It is anticipated that the Enlarged Group will start
test lending during the second half of the mobilisation period,
which will be restricted to friends and family. This test lending
would allow the Enlarged Group to test its operational resilience
before the Enlarged Group can apply for a Variation of Permission
to lift the deposit-taking restriction on the Banking Licence.
During the mobilisation phase, lending will be restricted and a
formal restriction will be applied to the Enlarged Group's deposit
taking, limiting this to a maximum of GBP50,000 of Financial
Services Compensation Scheme covered deposits.
In order for Fiinu 2 to be granted a Variation of Permission,
the Enlarged Group will need to demonstrate it has sufficient
regulatory and working capital to exit mobilisation and commence
unrestricted operations following further approval by the PRA/FCA.
The current estimate for this proposed fundraising, which is
expected to occur within 12 months of Admission, is cGBP30 million,
some two thirds of which would be for additional regulatory
capital. If the Enlarged Group is unable to raise this capital, or
to satisfy the other applicable conditions, it will be unable to
exit mobilisation or commence unrestricted operations. Should this
occur, the Enlarged Group could seek to extend mobilisation, with
the permission of the PRA/FCA, if they considered this to be the
best course of action or decide to surrender its Banking Licence
and focus solely on developing its IP/technology as a fintech
company. If the Enlarged Group decided to move away from its
original plan, it would then be able to release its regulatory and
buffer capital (which should be c.GBP6 million) and re-allocate it
for use in its Tech services business.
The Enlarged Group also has a Formal Recovery and a Solvent Wind
Down Plan in place for such a situation, but there can be no
guarantee that these options can be executed in such a way to avoid
a material adverse impact on the Enlarged Group's prospects.
DIRECTORS, PROPOSED DIRECTORS AND KEY MANAGEMENT
Brief biographical details of the Existing Directors, Proposed
Directors and senior management are set out below:
Existing Directors
All the Existing Directors, with the exception of Simon
Leathers, will be resigning at Admission.
Tim Hipperson - Non-Executive Chairman (aged 52)
Tim is an experienced and innovative business leader with
specialist knowledge in digital technology, data, content
development, media and mobile and has held CEO positions within
WPP, Interpublic Group and Publicis Groupe, and more recently as
Interim CEO of Weve Ltd, the jointly funded mobile venture invested
in by O2, EE and Vodafone. He has his own consultancy business,
Morph Management Ltd, running strategic business reviews, business
changes and M&A projects, and advises the investment market
(PE/VC) on current and future investment opportunities in
technology-based companies. Tim was appointed to the Board in
August 2017.
Mark Horrocks - Non-Executive Director (aged 60)
Mark joined the City in 1982 as a Financial Analyst for the
Guardian Royal Exchange Group Plc and went on to manage the UK
equity portfolios of the main Pension and Life funds representing
assets of over GBP2bn until leaving in 1997 to pursue his own
interests in the small company marketplace. He went on to join the
boards of several quoted small companies and gained a thorough
understanding of the needs of such companies as quoted businesses.
In 1999 he jointly created and launched the Small Company
Investment Trust Intrinsic Value Plc and is currently a Partner in
Intrinsic Capital LLP.
Simon Leathers FCA - Non-Executive Director (aged 47)
Simon qualified as a Chartered Accountant in 1999 and became a
Chartered Member of the Chartered Institute for Securities &
Investment (Chartered MCSI) in 2010. He has over 20 years of
corporate finance experience with PwC, BDO and several Equity
Capital Market brokerages. Over this period, Simon acted as an AIM
Qualified Executive, a LSE Main Market Sponsor and acted as lead
corporate financier on a broad range of capital market
transactions. Outside of Fiinu, Simon works as the CFO of
Conversity Limited, a B2B SaaS provider of Intelligent Guided
Selling Solutions. At Conversity, Simon has secured finance to
further product and sales development and has deployed payroll and
IT infrastructure in support of nascent overseas sales
operations.
On Admission, Simon, will remain on the Company's board as an
Independent Non-Executive Director and chair the Remuneration
Committee. He will also be a member of the Board Audit
Committee.
Fiinu Group Plc Directors
With effect from Admission, it is intended that the following
directors will be appointed. The Board construct is four
Independent Non-Executive Directors and three Executive Directors
with the Chair having
the casting vote.
David Hopton - Independent Non-Executive Chairman (aged 72)
David is an experienced Board member with over 40 years'
experience in financial services. He is a former banker and
regulator with extensive knowledge of financial services and
governance. Prior to Fiinu, David's experience includes 17 years at
the Bank of England, 22 years in Senior Management teams in UK
banking industry and five years as a Non-Executive Director and
External Adviser.
As a central banker, David was involved in research, policy,
regulation, money and government bond markets, industrial finance
and industrial relations, including two years at the Bank of
International Settlement in Basel, as Secretariat to the G10
Governors Committee.
At Abbey National / Santander, David was the Deputy Head of
Santander Global Banking and Markets UK, and a member of Santander
UK senior management team. David was member of ALCO, Risk and
Executive Committees. David was responsible for a Short-Term
Markets trading profit centre and for the management of short-term
liquidity.
After retiring from executive management, David was appointed as
Independent Non-Executive Director for Punjab National Bank
International Limited, a retail bank catering specifically for the
needs of Indian communities in the UK, where as well as being
Senior Independent Director David served as the Chair of Management
Committee of Board and Chair of Board Risk Committee. David was
also a member of Audit and Compliance Committee and Nomination and
Remuneration Committee. David is currently also an Independent
Non-Executive Director at Masthaven Bank in the UK.
Chris Sweeney - Chief Executive Officer (aged 56)
Chris is an experienced executive. Prior to joining Fiinu, Chris
was CEO at 118 118 Money and prior to that he was CEO of Vanquis
Bank and Executive Director with over 20 years' experience in
consumer finance and retail banking with a track record of driving
businesses through strategic transformational change in UK and
overseas markets. He is adept at building and leading robust and
delivery focused teams and a passionate believer that strategic
change is led by really understanding what customers truly value
and that meeting those insights will deliver outstanding commercial
results and good customer outcomes.
At Vanquis Bank, Chris drove forward the bank's key
digitalisation agenda, attracting over 850,000 customers on to the
mobile app by the time he left the bank. He grew Vanquis Bank
business year on year and played a key role in settling the GBP172
million Financial Conduct Authority investigation into the
Vanquis Bank Repayment Option Plan.
Prior to joining Vanquis Bank, Chris was the Chief Executive of
Personal Banking, International at Standard Bank, and became Group
Executive of Card Payment Solutions in January 2013. Between 2001
and 2010 he worked for Barclaycard and Barclays, across the UK,
Europe and Africa. Chris has an BSc (Hons) degree in Chemistry from
the University of Birmingham and has completed the Advanced
Management Programme at Harvard Business School.
Philip Tansey FCA - Chief Financial Officer (aged 55)
Philip is the former CFO for WH Ireland plc, an AIM quoted
financial services group comprising bespoke personal wealth
management services with a corporate and institutional broker.
Philip has extensive experience leading global operations in
dynamic enterprises. He joined Panmure Gordon as a main Board
Executive Director from BGC Partners Inc where he was Chief Control
Officer. Over six years he managed the day-to-day operation of the
firm's infrastructure, its public accounts and significant
transactions including acquisitions, restructurings and legal
negotiations including a major turn-around and clean-up
operation.
He also acted as Company Secretary. Before joining BGC, he was a
director within Deutsche Bank's Office of Internal Controls. His
career has also spanned Credit Suisse First Boston, where he was
Chief Operating Officer of the bank's fixed income and derivatives
product control group. Phillip's early career included roles at
CIBC Wood Gundy, Bankers Trust, Salomon Brothers and BDO Stoy
Hayward, where he qualified as a chartered accountant.
Dr Marko Sjoblom - Founder and Executive Director (aged 51)
Marko is a successful second-time entrepreneur and the Founder
of Fiinu. He is the CEO of Fiinu's technology business, Fiinu
Services Ltd. He is a former elite athlete with a doctorate in
artificial intelligence and unbundling banking services. His
fintech experience includes over ten years on Wall Street and in
the City of London including ten years with leading banking,
treasury, risk and payments companies. He has served as a treasury
steering committee member at four DAX-30 companies.
Prior to Fiinu, Marko founded one of the largest overdraft-style
lenders in the UK which developed a fully automated software robot
that lent and recovered over $1 billion in small increments in the
UK without reliance on credit bureau data. His previous business
was independently valued at $171 million after five years.
Prior to becoming an entrepreneur, Marko was a sales director at
Reval, a Wall Street based hedge accounting and quant risk
modelling platform. The company was acquired by Carlyle Group,
through a $280 million LBO. Marko was a director at Kyriba, an
in-house bank and payment factory SaaS platform which became a
unicorn after receiving a $160 million investment from Bridgepoint
Capital. Marko was also with Trema for five years, helping large
incumbent banks and corporate treasuries to manage their risk
through straight-through-process automation. The company was
acquired by Warburg Pincus, through a $150 million LBO in 2006 and
later by ION Group.
Huw Evans - Independent Non-Executive Director (aged 62)
Huw worked for Barclays Bank for 30 years in various roles. He
has a very strong banking risk and credit background including a
role as the Risk Director with the 12 countries that then comprised
Barclays Africa & Middle East and, latterly, ten years with
banks in the Middle East in similar roles. Huw is an
enterprise-wide risk professional who is used to building strong
relationships at C-Suite and board level.
He is an experienced wholesale and debt capital markets
practitioner, as well as being thoroughly versed in all aspects of
consumer lending, portfolio optimisation and auto-decisioning,
developed and proven over many years. Prior to joining Fiinu, Huw
was Group Chief Credit Officer at the Commercial Bank of Qatar
where he was responsible, amongst other things, for all aspects of
enterprise-wide consumer credit origination, processing, scoring
and recovery. Huw also owned the risk control framework for BMI
Bank (Bank Muscat International) in Bahrain, as their Chief Risk
Officer.
He is currently an Independent Non-Executive Director at All
Africa Capital Limited, a financial consultancy based in
London.
On the commitments of the Banking Licence, Huw will become Chair
of the Fiinu 2 Board Risk and Compliance Committee ("BRCC") and a
member of the Fiinu Bank Board Audit Committee ("BAC") and the
Remuneration and Nominations Committee ("BRNC") subject to
regulatory approval of his appointment.
Jerry Loy FCA - Independent Non-Executive Director (aged 53)
Jerry has served over 25 years in financial services with a
focus on accounting and audit. He has worked across the private and
public sectors and led the development of small to large companies
through multiple transformations (be it systems, processes, people)
including start-up, growth, maturing and decline.
Prior to joining Fiinu, Jerry gained valuable banking, financial
and operational experience with KPMG, The Capital Group, the
private banking arms of two Middle Eastern banks as well as
managing programmes for the UK Government's Department for
International Trade and the Japanese Government's Ministry of
Foreign Affairs.
Jerry has extensive experience of working with audit committees
and with regulatory bodies. At NBAD Private Bank (Suisse) SA and
QNB Banque Privée (Suisse) SA, two start up banks, Jerry served as
Secretary to the Audit Committee and The Board of Directors. Jerry
now chairs the audit committees for two other regulated financial
services entities and is an Independent Non-Executive Director at
Redwood Bank. Jerry is a Fellow of the Institute of Chartered
Accountants in England and in Wales, qualifying with KPMG.
On Admission, Jerry will also become an Independent
Non-Executive Director at Fiinu 2. He will also Chair the board of
Fiinu Services and the Fiinu 2 BAC and be a member of BRNC and
BRCC, bringing his extensive audit and senior executive management
experience to the business.
ENDS
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END
IOEDZLFFLQLLBBB
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June 14, 2022 13:22 ET (17:22 GMT)
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