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FairFX Acquires CardOne, Launches GBP26 Million Fundraising (ALLISS)

LONDON (Alliance News) - FairFX Group PLC said Tuesday it has conditionally acquired banking ...

Alliance News 8 August, 2017 | 9:57AM
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LONDON (Alliance News) - FairFX Group PLC said Tuesday it has conditionally acquired banking firm CardOne for GBP15.0 million, as it launched a GBP26.0 million share placing and open offer.

FairFX will place around 46.0 million shares at 58.0 pence each, raising GBP25.0 million. A further 1.7 million shares will be made available in an open offer to existing shareholders, raising a further GBP1.0 million.

Shares in FairFX were up 0.9% at 72.65p Tuesday, with a total of 103.8 million shares in issue, giving it a market capitalisation of GBP79.9 million.

The company said the majority of the proceeds will fund its acquisition of CardOne, a digital banking services provider to small businesses and retail consumers. CardOne will be acquired with GBP12.8 million in cash, and the remainder by the issue of FairFX shares at the same price as the placing, implying around 3.8 million shares will be issued to settle the remaining GBP2.2 million.

FairFX said the acquisition will "fast-track" its push into the small business lending space, complementing its current corporate expense management platform. The additional funds will also give it "flexibility" in terms of posting collateral. The management of CardOne will be retained, as will the brand.

In its financial year ended November 30, 2016, CardOne made a net profit of GBP800,000 from revenue of GBP5.5 million. For the six months to May 31, net profit amounted to GBP600,000, with revenue of GBP2.8 million.

FairFX said it believes the acquisition will be earnings enhancing in the first full year after completion, with cost savings estimated at GBP3.5 million over three years. FairFX said it now believes it can achieve revenue over GBP30.0 million and earnings before interest, tax, depreciation and amortisation of GBP15.0 million by the end of 2020.

The acquisition and placing are dependent on shareholder approval at a general meeting on August 24.

By Adam Clark; adamclark@alliancenews.com

Copyright 2017 Alliance News Limited. All Rights Reserved.

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Securities Mentioned in Article

Security Name Price Change (%) Morningstar
FairFX Group PLC 88.50 GBX -1.12 -

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