Proposed Acquisition and Placing to raise c.£8m
14/06/2022 18:22
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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.£8 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 £37.5 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 £8
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 £1.19 million. As at 30 September
2021, Fiinu had unaudited net assets of approximately £0.73 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®. 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®, 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
£8 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 £2.49 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 £14
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®,
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 £37.5
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 £10 billion funding gap in
the £300 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 £85,000. 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 £1,500 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® 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 £6 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 £50,000 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
c£30 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.£6 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 £2bn 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 £172 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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