Monitise, the UK mobile banking services group, expects to announce a £31m rights issue on Thursday to fund investment in India and other new areas of operation.
Through the issue of ordinary shares and a placing, which is fully underwritten by…
Monitise, the UK mobile banking services group, expects to announce a £31m rights issue on Thursday to fund investment in India and other new areas of operation.
Through the issue of ordinary shares and a placing, which is fully underwritten by institutional and other investors, including Visa and First Eastern, the group also seeks to retain and extend its technological advantage, and support ongoing cash generation growth.
Its shareholders, including Visa, UPS Global Asset Management and Standard Chartered Bank, had until July 27 to agree to the issue of 155,971,200 new ordinary shares offered for 20.75p each. This represented a 1.2 per cent discount to 21p on July 12 – the day before the Circular was distributed.
The net proceeds of the raising will be used with Monitise’s existing cash resources, which the group said were approximately £13m as at June 30 this year.
Evolution Securities is acting as nominated adviser and joint broker in relation to the subscriptions and the placing. Piper Jaffray is acting as joint broker in relation to the placing.
Alastair Lukies, Monitise’s chief executive officer, told TelecomFinance: “The current fund raising activity is designed to enable us to quicken the expansion of our global reach and broaden the service range we provide in new and existing operating territories
“It is our intention to realise the full potential of the opportunity before us, creating value for our customers, partners and shareholders alike.”
Ahead of Thursday’s General Meeting, the group today launched operations in India to expand its mobile banking reach.
During his first trip to the country as chancellor, George Osborne hailed the group’s 50-50 joint venture with Visa as representing the importance of British business exporting overseas.
The venture aims to build a mobile platform for financial services providers, enabling the delivery of remote mobile payments services such as banking, bill payments, ticket purchases and mobile top-ups.
According to Monitise, out of India’s population of 1.1 billion people, 200 million of a 600 million working population have bank accounts, and nearly 600 million have a mobile phone. Roughly 91 per cent of the US$703bn spent by Indians every year is in the form of cash, the company says.
As well as the joint venture with Visa, Monitise is also developing Indian banking services with Standard Chartered Bank, which it expects to go live with in the next 12 months.
Speaking at Monitise’s launch in India today, Richard Johnson, the group’s strategy director, praised the progressive approach of the country’s Reserve Bank for leading the way in providing mobile financial access.
Johnson said: “For the full potential of mobile banking and payments to be achieved, banks, payments networks and mobile network operators have realised that they must come together in partnership and collaboration.”
