REG - Fiinu PLC - Operational & Strategic Update & Board Changes

FiinuAnnouncement

29/09/2023 07:00

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20230929:nRSc0763Oa&default-theme=true

RNS Number : 0763O  Fiinu PLC  29 September 2023

29 September 2023

 

Fiinu Plc

("Fiinu", the "Company" or the "Group")

 

Operational & Strategic Update & Proposed Board Changes

 

Fiinu, a fintech group, creator of the Plugin Overdraft®, provides an
operational and strategic update.

 

Overview

On 12 July 2023, the Company reported that it was still facing challenges in
order to raise the full amount of funding required to provide the exit capital
for its subsidiary Fiinu 2 Limited (formerly Fiinu Bank Limited) to be able to
exit its mobilisation period and commence operations without restrictions. It
also stated that it had submitted (and had accepted by the regulators) an
application to withdraw its banking licence with the aim of re-applying after
a short period once exit funding had been secured. These funding challenges
have continued over the summer and, whilst the Company remains engaged in a
number of live discussions with potential investors, none of them has advanced
sufficiently at this point to enable Fiinu 2 Limited to make a re-application
for its banking licence.

 

Cash resources

As announced on 12 July 2023, the Company initiated controlled cost reductions
at its subsidiaries, Fiinu 2 Limited and Fiinu Holdings Limited.  By reducing
costs in Fiinu 2 Limited and Fiinu Holdings Limited, the balance of resources
available to the Company and across the Group are providing additional time to
determine the best way forward for shareholders for the current or potential
alternative strategy.

 

These cost reductions have proceeded according to the Company's detailed plan
and remain on track.  As at 28 September 2023, the Group had available
unaudited cash resources of approximately £1.9 million, having repaid the
£750,000 principal (and unpaid interest of £7k) outstanding on the Dewscope
Loan, originally entered into on 15 June 2022, as amended on 14 March 2023.
The amount remaining represents enough funds to enable the Group to scale back
its current operations in Fiinu 2 Limited and Fiinu Holdings Limited and
continue to meet its financial obligations as they fall due.

 

Maintain strategy

The Board plans to continue with its cost reduction process, which will
accelerate from now until the end of the financial year, to preserve the
integrity of its technology intellectual property, infrastructure and
regulatory documentation, but will reduce headcount significantly to preserve
cash.

 

This will ensure that Fiinu 2 Limited is in a position to commence the
re-application for its banking licence when the Company has secured the
required funding. However, ahead of making the re-application and to ensure
the required level of technological and regulatory readiness for the business
to re-initiate the process, a hiring process will need to be undertaken by the
Board. It is not possible at this time to quantify the time period.

 

Certain members of the Board of Fiinu 2 Limited and the Company have now been
served notice to reduce future operating costs, in line with the Company's
cost reduction plan, and will step down as directors on 31 December 2023.
Further details are set out below.

 

To provide further continuity of knowledge, all the non-executive directors of
Fiinu 2 Limited will be retained on a consultancy basis, at no cost, and be
available to support the future fundraising efforts, as well as support any
engagements with the regulators when required.

 

Board announcements

David Hopton, Jerry Loy, and Huw Evans will leave the Company's Board on 31
December 2023, in the absence of any new potential funding developments.  All
have agreed to remain after this time in an advisory capacity to support
future fundraising activities and assist with any future engagement with the
regulators should that be required.  Chris Sweeney, Group CEO, and CEO of
Fiinu 2 Limited, has also been served notice as planned and will step down as
a Director of all the Group companies on 31 December 2023.

 

From 31 December 2023, in the absence of any funding developments and/or
additional board appointments, the Company's Board of Directors will consist
of Simon Leathers (Senior Independent Non-executive Director) and Marko
Sjoblom (Founder and Executive Director), who will be appointed as Group CEO
from that date during the fund-raising period with deferred remuneration
subject to being successful with the re-application process.  The Company
will also look to recruit further independent non-executive directors, as
appropriate, to satisfy its corporate governance requirements.  Further
announcements will be made as appropriate.

 

Further funding requirements

The Company will continue to review all its options in respect of the
business, including further discussions to source the additional funding
required for it to re-apply to the regulators to re-commence the banking
licence application for Fiinu 2 Limited.  As part of the continued review of
its cashflow requirements, the Company will look to raise further funding to
support at least the 12-month period from the issuance of the 2023 Year End
accounts, whilst it seeks to raise the capital for the re-application process.
 As previously announced the required capital for the re-application process
is between £35m - £42m.  Further announcements in respect of the interim
funding requirements will be made in due course.

 

No change to current strategy

As referred to above in this announcement, the Company does not anticipate, at
this time, changing its current strategy.  Any fundamental change of strategy
that involves the cessation of operations, or the sale of all or substantially
all of the Group's business and assets (for example, the Group's technology
stack and other intellectual property) would require the approval of
shareholders in general meeting in compliance with AIM Rule 15, but no
decision on this course of action has been made.

 

The Company will make further announcements on progress and other developments
as and when appropriate.

 

Commenting, Chris Sweeney, CEO of Fiinu, said:

 

"Funding conditions have remained challenging for a business at Fiinu's stage
of development.  It is disappointing that we have been unable to secure the
required funding to enable the Company to launch into the marketplace.  In
the current economic climate, there is a definite need for the Plugin®
overdraft to support customers with their credit needs.

 

I must again thank colleagues for their work in developing our technology
solution and infrastructure which will give the Company the best chance to
re-launch in the future should it secure the required funding when capital
markets improve.  I would also like to thank them for their understanding of
some of the recent decisions we have had to take to preserve cash and wish
them every success in the future.  The proposed Board changes are also being
made to reduce ongoing costs to preserve cash, but I am delighted that all the
non-executive directors have agreed to remain as unpaid Board advisers to
assist the Group with future fundraising efforts, as well as support any
engagements with the regulators as required.

 

The Company will continue to engage with potential investors as it has been
doing for many months."

 

Market Abuse Regulation ('MAR') Disclosure

 

Certain information contained in this announcement would have been deemed
inside information for the purposes of Article 7 of the Market Abuse
Regulation (EU) No 596/2014 ('MAR'), which is part of UK law by virtue of the
European Union (Withdrawal) Act 2018, until the release of this announcement.

 

ENDS

 

 Enquiries:

 Fiinu plc                                            via Brazil London (press office for Fiinu)

 Chris Sweeney, Chief Executive Officer

 www.fiinu.com (http://www.fiinu.com)

 SPARK Advisory Partners Limited (Nomad)              Tel: +44 (0) 203 368 3550

 Mark Brady / Adam Dawes

 SP Angel Corporate Finance LLP (Joint Broker)        Tel: +44 (0) 207 470 0470

 Bruce Fraser / Ezgi Senturk

 Panmure Gordon (UK) Limited (Joint Broker)           Tel: +44 (0)207 886 2500

 Stephen Jones / Atholl Tweedie (Corporate Finance)

 Hugh Rich (Corporate Broking)

 Brazil London (press office for Fiinu)               Tel: +44 (0) 207 785 7383

 Joshua Van Raalte / Christine Webb / Jamie Lester

 

About Fiinu

 

Fiinu, founded in 2017, is a fintech group, that developed the Plugin
Overdraft® which is an unbundled overdraft solution that allows customers to
have an overdraft without changing their existing bank. The underlying bank
Independent Overdraft® technology platform is bank agnostic, that therefore
enables it to serve all other banks' customers. Open Banking allows Fiinu's
Plugin Overdraft® to attach ("plugin") to the customer's existing primary
bank account, no matter which bank they may use. Fiinu's vision is built
around Open Banking, and it believes that it increases competition and
innovation in UK banking.

 

For more information, please visit www.fiinu.com (http://www.fiinu.com)

 

 

 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  UPDVVLFLXKLBBBX