FAIRFX Group PLC Acquisition of Q Money Limited and E-Money Licence (5495U)
19 January 2017 - 6:00PM
UK Regulatory
TIDMFFX
RNS Number : 5495U
FAIRFX Group PLC
19 January 2017
19 January 2017
FairFX Group plc
("FairFX" or "the Group" or "the Company")
FairFX to Acquire E-Money Licence through Acquisition of Q Money
Limited
FairFX, the low cost multicurrency payments service, is pleased
to announce that it has agreed to acquire the entire issued
ordinary share capital of Q Money Limited ("Q Money") with its
associated e-money licence ("Acquisition").
The Acquisition is an important milestone in the evolution of
FairFX and opens up many exciting opportunities for the Group.
Firstly, the e-money licence opens an array of options for
FairFX to rationalise its cost base including the possibility of
becoming the issuing bank of its own cards and internalising parts
of the supply chain. By reducing the infrastructure cost and
processes, FairFX will be able to more rapidly grow its product
portfolio and gain competitive advantage unencumbered by existing
cost and time constraints.
Secondly, FairFX believes that businesses, particularly SMEs,
have been poorly served by banks for a long time. Creating a UK
digital-banking product for businesses provides FairFX the
opportunity to further diversify its revenue stream and to enter a
market that it believes currently has relatively few participants.
Growth in the Group's expense management platform has demonstrated
demand and gaining an e-money licence allows the Group to expand
this offering to encompass more products and services.
Thirdly, the e-money licence permits FairFX to take advantage of
opportunities created by anticipated government legislation that is
expected to open up direct access to the UK payments
infrastructure.
In addition, as part of the Acquisition, Tony Quirke will become
Chief Financial Officer of FairFX. Previously, Tony was CFO at
Kalixa Pay, where he played a key part in the development and
growth of the e-banking, card issuing and acquiring businesses.
The initial consideration payable for the Acquisition is
GBP425,000, to be satisfied by GBP110,000 payable from existing
cash and by the issue of 724,136 new ordinary shares of 1p each in
the Company (the "Initial Consideration Shares") at an issue price
of 43.5p. Further consideration of up to GBP825,000 may be payable
to Q Money over the next 3 years, subject to the achievement of
certain performance milestones, and will be satisfied by the issue
of new ordinary shares of 1p each in the Company at an issue price
of 43.5p.
The vendors of Q Money have entered into a lock-in arrangement
whereby they have agreed not to dispose of any of the consideration
shares they receive for a period of two years following their
issuance (except in certain limited circumstances where an orderly
market will apply) and thereafter via an orderly market agreement
for a further three years.
Completion of the Acquisition is conditional upon the admission
of the Initial Consideration Shares to trading on AIM which is
expected to take place on 24 January 2017. Following admission of
the Initial Consideration Shares, the enlarged share capital of the
Company is expected to be 103,840,175 ordinary shares of 1p each in
the Company ("Ordinary Shares").
The vendors of Q Money will retain an aggregate 20% economic
interest in Q Money entitling them to 20% of any dividends paid by
Q Money to the Group and/or 20% of any sale proceeds of Q Money
should it be sold. Various protections have been put in place in
respect of that economic interest including put and call options
enabling that interest to be converted into Ordinary Shares in the
event of an offer for the Company.
Ian Strafford-Taylor, Chief Executive Officer, commented: "The
acquisition of Q Money is an important strategic step for FairFX.
The e-money licence will allow us to rationalise our supply chain,
thereby reducing costs, but more importantly it widens our horizons
in terms of the products and services we can provide to our
customers and the speed at which we can deploy them. We can also
internalise transactions within the FairFX ecosystem allowing
FairFX customers to transact with each other in a far more
efficient and cost-effective manner.
"In addition, I would like to welcome Tony to the senior
management team as our CFO. Having begun to build out the senior
team in 2016, his appointment means we are now well set to execute
our future plans."
This announcement contains inside information.
ENDS
FairFX Group plc
Ian Strafford-Taylor,
CEO +44 (0) 20 7778 9308
Cenkos Securities plc
Max Hartley/Callum Davidson +44 (0) 20 7397 8925
Yellow Jersey PR
Charles Goodwin +44 (0) 7747 788 221
About FairFX
FairFX is a leading international payment services provider,
incorporated in the UK in 2005. The Company has developed a
cloud-based peer-to-peer payments platform that enables personal
and business customers to make easy, low-cost multi-currency
payments in a broad range of currencies and across a range of FX
products all via one integrated system. The FairFX platform
facilitates payments either direct to Bank Accounts or at 30
million merchants and over 1 million ATM's in a broad range of
countries globally via Mobile apps, the Internet, SMS, wire
transfer and MasterCard/VISA debit cards.
FairFX operates within the rapidly growing online multi-currency
payments market and provides transactional services to both
personal and business customers through four channels being
Currency Cards, Physical Currency, FairPay and Dealing. The
Currency Card and Physical Currency offerings facilitate multiple
overseas payments at points of sale and ATM's whereas the FairPay
and Dealing products support wire transfer foreign exchange
transactions direct to Bank Accounts.
For Corporates, FairFX has a market-leading business-expenses
solution based around its corporate prepaid card allied to a
platform allowing the Corporate to better control expenses and
improve transparency whilst removing administrative burdens from
staff.
In addition, FairFX has entered into a number of "white-label"
arrangements for the use of its P2P matching platform. Partners
include easyjet, ThinkMoney, Pitney Bowes and Quintessentially.
FairFX has also partnered with Concur Technologies, Inc. a leading
provider of integrated travel and expense management solutions with
over 25 million users globally. Such relationships provide strong
support for FairFX's customer acquisition strategy.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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