TIDMBANK
RNS Number : 9911S
Fiinu PLC
15 March 2023
15 March 2023
Fiinu Plc
("Fiinu", the "Company" or the "Group")
Fundraising, Issue of Equity, Related Party Transactions and
TVR
Fiinu (AIM: BANK), a fintech company including the fully owned
Fiinu Bank Limited, creator of the Plugin Overdraft(R), announces
that it has conditionally raised up to GBP6.49 million, before
costs, ("Fundraising") in new equity funding ("New Ordinary
Shares") subject, inter alia, to admission of the New Ordinary
Shares to trading on the AIM Market of the London Stock Exchange
("Admission").
This Fundraising is split into three components:
-- An immediate subscription ("Subscription") of 3,846,155 New
Ordinary Shares at an issue price of 13 pence per New Ordinary
Share to new and existing shareholders to raise approximately
GBP0.5 million;
-- The proposed conversion of the existing GBP2.49 million loan
facility with Dewscope Limited ("Dewscope") ("Dewscope Loan"), of
which GBP1.99 million remains undrawn, into up to 19,153,847 New
Ordinary Shares, at a price of 13 pence per New Ordinary Share.
This conversion, which is by way of a further agreement with
Dewscope entered into on 14 March 2023, is expected to occur in
tranches following draw down, at the Company's option, between now
and the end of June 2023; and
-- GBP3.5 million draw down from a new three year share
subscription facility agreement ("Subscription Facility"), with GEM
Global Yield LLC SCS and GEM Yield Bahamas Limited (together
"GEM"), which has a total maximum draw down potential of up to
GBP40.0 million, at a price per New Ordinary Share determined on
the date of subscription, but with a condition in respect of this
initial GBP3.5 million draw down that the issue price must not fall
below 10p per New Ordinary Share, therefore the maximum number of
New Ordinary Shares that could be issued to GEM pursuant to the
initial draw down is 35,000,000. It is expected that this issue of
New Ordinary Shares to GEM and Admission, will take place in early
May 2023.
The New Ordinary Shares issued in respect of the Subscription
and conversion of the Dewscope Loan will be issued with new
three-year warrants ("Warrants") that are exercisable at 20 pence
per share into new ordinary shares in the Company at the ratio of 1
Warrant for every 19 New Ordinary Shares issued by the Company
(making a total of up to 1,210,526 Warrants). These Warrants
expire, unless exercised, three years after being issued, will not
be admitted to trading on AIM (although the underlying ordinary
shares upon exercise shall be) and may be re-priced in certain
circumstances during the three-year period.
In consideration of entering into the Subscription Facility, the
Company has issued 17 million warrants to GEM ("GEM Warrants") with
an expiry date of 15 March 2026, that are exchangeable into new
ordinary shares with an exercise price of 20 pence per share. The
GEM Warrants (which will not be admitted to trading on AIM,
although the underlying ordinary shares upon exercise shall be) are
transferable at GEM's option and may be re-priced in certain
circumstances during the three-year period.
Further details of all these arrangements are set out below.
This Fundraising, which forms part of the Company's anticipated
further funding requirements announced on 26 January 2023, will be
drawn down between now and the end of June 2023, subject to
Admission. All the New Ordinary Shares issued will rank pari passu
with existing shares (save for the Warrants and GEM Warrants above)
and will rank as qualifying CET1 regulatory capital. Further
announcements will be made as New Ordinary Shares are issued and
Admission occurs.
The proposed Fundraising and regulatory capital plan has been
shared with the Prudential Regulation Authority ("PRA"([1]) ).
Commenting on the Fundraising, Chris Sweeney, CEO of Fiinu,
said:
"As we progress through the next phase of our mobilisation plan,
this initial tranche of the overall funding requirement previously
outlined, further de-risks the business as it executes on its plans
for its subsidiary, Fiinu Bank Limited, to become a fully licenced
bank which is anticipated to take place in summer 2023, subject to
regulatory approval and funding. We are thankful to Dewscope, GEM
and to all our investors for their continued support."
Further Information on the Subscription
The Company has agreed to issue 3,846,155 New Ordinary Shares at
an issue price of 13 pence per New Ordinary Share to new and
existing shareholders to raise approximately GBP0.5 million. The
New Ordinary Shares, will be issued with 1 Warrant for every 19 New
Ordinary Shares issued by the Company with an exercise price of 20p
per new ordinary share. These Warrants (approximately 202,429)
expire, unless exercised, three years after being issued and will
not be admitted to trading on AIM (although the underlying ordinary
shares upon exercise shall be).
In respect of the Warrants, on the first anniversary of the
Subscription, if the share price of the Company is less than 90% of
the exercise price of 20 pence, the original exercise price can be
adjusted to a figure equating to 110% of the market price
prevailing at that time. In addition, the exercise price of the
Warrants and the number of warrant shares can be adjusted from time
to time in a limited number of circumstances, such as a change in
the nominal value of the Company's ordinary shares, further issues
of ordinary shares, bonus issues or capital distributions.
Up to 3 million New Ordinary Shares have been placed with
clients of Intrinsic Capital LLP, where Mark Horrocks (a former
Director of the Company and owner of Dewscope) is both a partner
and a client. As part of the Subscription, Mr Horrocks will
subscribe for 1,457,693 New Ordinary Shares.
Further information on the Dewscope loan conversion
On 15 June 2022, the Company entered into an unsecured facility
agreement ("Dewscope Loan Agreement") with Dewscope (a company of
which Mark Horrocks is a director and is an indirect beneficiary),
pursuant to which Dewscope agreed to make available a loan facility
of up to GBP2.49 million for a period of two years (the
"availability period"). The Company agreed to pay Dewscope an
arrangement fee in cash of 2% of the maximum facility amount and 3%
on each tranche draw down with a minimum tranche size of
GBP250,000. The Company is entitled to draw down amounts under this
facility at its discretion on notice to Dewscope. Interest is
payable on amounts drawn down at a rate of 12.5% per annum, paid
monthly in arrears. The facility is unsecured.
On 15 November 2022, GBP500,000 of the Dewscope Loan was drawn
down by the Company.
On 14 March 2023, the Company entered into a further agreement
with Dewscope ("Conversion Agreement") that allows for the Company
to elect to convert all or part of the GBP2.49 million of the
Dewscope Loan into New Ordinary Shares at a subscription price of
13 pence per New Ordinary Share. If the whole amount of the
Dewscope Loan was converted, the maximum number of New Ordinary
Shares that could be issued to Dewscope would be up to 19,153,847
New Ordinary Shares.
In addition, new Warrants that are exercisable at 20 pence per
share into new ordinary shares at a ratio of 1 warrant for every 19
ordinary shares issued by the Company, will be issued to Dewscope
on conversion of the Dewscope Loan into New Ordinary Shares. The
maximum number of warrants that could be issued in the event that
the Company draws down upon, and then elects to convert, the entire
loan facility of GBP2.49 million into new ordinary shares would
therefore be up to approximately 1,008,097 Warrants.
In respect of the Warrants, on the first anniversary of entering
into the Conversion Agreement, if the share price of the Company is
less than 90% of the exercise price of 20 pence, the original
exercise price can be adjusted to a figure equating to 110% of the
market price prevailing at that time. In addition, the exercise
price of the Warrants and the number of warrant shares can be
adjusted from time to time in a limited number of circumstances,
such as a change in the nominal value of the Company's ordinary
shares, further issues of ordinary shares, bonus issues or capital
distributions.
The Directors expect that conversion of the Dewscope Loan will
occur between now and June 2023; further announcements will be made
as appropriate.
By virtue of his interest in Dewscope, and participation in the
Subscription, Mark Horrocks, on conversion of the Dewscope Loan, is
expected to become interested in over 10% of the issued share
capital of the Company and therefore in turn its fully owned group
company, Fiinu Bank Limited, for which he has received FCA approval
as a controller.
Related Party Transactions
As Mark Horrocks was a Director of the Company until 8 July
2022, entering into the Conversion Agreement with Dewscope, and
participation in the Subscription, are related party transactions
for Fiinu under AIM Rule 13 of the AIM Rules for Companies. The
Directors consider, having consulted with SPARK Advisory Partners
Limited, the Company's Nominated Adviser, that the terms of the
Conversion Agreement and the Subscription are fair and reasonable
insofar as the Company's shareholders are concerned.
Further information on the GEM Subscription Facility
On 14 March 2023, the Company entered into a share subscription
facility agreement ("Subscription Facility") with GEM for a maximum
commitment period of three years. Under the Subscription Facility,
the Company can draw down, at its option, up to GBP40 million in
new equity funding, to be satisfied by the issue of new ordinary
shares in the Company, subject to certain conditions, including
Admission, by submitting a notice detailing the funds required by
the Company ("Subscription Notice").
The initial draw down, set out in this announcement, has been
agreed at an amount up to GBP3.50 million, the Subscription Notice
submitted to GEM, and will settle after a period of 30 trading days
from today, being on or around 28 April 2023, subject to Admission.
The number and subscription price of the New Ordinary Shares issued
in return will be calculated as 90% of the average of the 30
closing bid prices at the end of that 30 day trading period, but is
conditional upon the subscription price for the New Ordinary Shares
in this initial Subscription Notice being not less than 10 pence
per New Ordinary Share, which is the nominal value of the Company's
shares, therefore the maximum number of shares that could be issued
to GEM pursuant to the initial draw down is 35,000,000. As receipt
of the GBP3.50 million remains subject to Admission, application
for New Ordinary Shares to be admitted to trading on AIM will be
made in due course.
In respect of future possible drawdowns from the GEM Facility,
the potential number of new ordinary shares issued by the Company
and the funds received as a result of each Subscription Notice are
dependent upon the average volume of trading in the shares of the
Company over a preceding period of 30 trading days and the average
closing bid prices at the end of each 30-day trading period.
In addition, in consideration of entering into the Subscription
Facility, the Company issued 17 million new warrants to GEM ("GEM
Warrants") with an expiry date of 14 March 2026, that are
exchangeable into new ordinary shares with an exercise price of 20
pence. The GEM Warrants (which will not be admitted to trading on
AIM, although the underlying ordinary shares upon exercise will be)
are transferable at GEM's option.
In respect of the GEM Warrants, on the first anniversary of
entering into the Facility Agreement, if the share price of the
Company is less than 90% of the exercise price of 20 pence, the
original exercise price can be adjusted to a figure equating to
110% of the market price prevailing at that time. In addition, the
exercise price of the GEM Warrants and the number of warrant shares
can be adjusted from time to time in a limited number of
circumstances, such as a change in the nominal value of the
Company's ordinary shares, further issues of ordinary shares, bonus
issues or capital distributions.
Whilst the Subscription Facility has a maximum drawdown
capability of up to GBP40 million over the three-year period, there
is no guarantee that the Company will raise any further money from
GEM following the initial GBP3.50 million.
In addition, under the terms of the Subscription Facility, at no
time is GEM able to own more than 10% of the issued share capital
of the Company.
Further announcements will be made as appropriate.
Possible effect of the fundraise on the Issued Share Capital of
the Company
When all of the transactions envisaged in this announcement have
been completed, excluding the exercise and issue of all warrants,
using 13 pence per New Ordinary Share as an illustration, there
would be a total number of ordinary shares in issue of
approximately 315,054,940. At the present time, the Company has
265,131,861 ordinary shares in issue.
Admission and Total Voting Rights
The Fundraising is subject to Admission. The Company has the
authority to issue and allot the New Ordinary Shares pursuant to
certain existing shareholder authorities granting such powers to
the directors at the Company's General Meeting held on 20 February
2023. It is expected that Admission for the New Ordinary Shares
issued and allotted in respect of the Subscription will become
effective, and dealing in these New Ordinary Shares will commence,
at 8.00a.m, on or about 20 March 2023. Further announcements
regarding Admission of the New Ordinary Shares in respect of the
Subscription Facility and/or the Conversion Agreement will be made
as appropriate.
Following Admission of the New Ordinary Shares in respect of the
Subscription, the share capital of the Company will comprise
268,978,016 Ordinary Shares. The above figure of 268,978,016 may be
used by shareholders as the denominator for the calculations by
which they will determine if they are required to notify their
interest in Fiinu under the Financial Conduct Authority's
Disclosure Guidance and Transparency Rules.
Further funding requirements
As previously announced on 26 January 2023, the Company plans to
raise a total of approximately GBP35-40 million on a staged basis
commencing in the run-up to Easter through to completion in July
2023 in preparation for its anticipated exit from mobilisation and
the commencement of unrestricted banking services. This Fundraising
is the start of that staged funding process and management
forecasts indicate that this initial funding combined with the
balance of that GBP35-40 million total funding, when achieved, will
be sufficient to resource the Company in its initial year of full
banking activity assuming the grant of the unrestricted banking
licence in July 2023.
Further announcements will be made regarding this process as
appropriate.
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
Chris Sweeney, Chief Executive Officer office for Fiinu)
Philip Tansey, Chief Financial Officer
www.fiinu.com
SPARK Advisory Partners Limited (Nomad) Tel: +44 (0) 203 368
Mark Brady / Adam Dawes 3550
SP Angel Corporate Finance LLP (Joint Tel: +44 (0) 207 470
Broker) 0470
Matthew Johnson / Charlie Bouverat (Corporate
Finance)
Abigail Wayne / Rob Rees (Corporate Broking)
Panmure Gordon (UK) Limited (Joint Broker) Tel: +44 (0)207 886
Stephen Jones / Atholl Tweedie (Corporate 2500
Finance)
Tom Scrivens / Hugh Rich (Corporate Broking)
Brazil London (press office for Fiinu) Tel: +44 (0) 207 785
Joshua Van Raalte / Christine Webb / 7383
Jamie Lester Email: fiinu@agencybrazil.com
About Fiinu
Fiinu, founded in 2017, is a fintech group, including Fiinu
Bank({1]) , which is authorised by the Prudential Regulatory
Authority([1]) . Fiinu's Plugin Overdraft(R) is an unbundled
overdraft solution which allows customers to have an overdraft with
Fiinu Bank without changing their existing bank. The underlying
Bank Independent Overdraft(R) technology platform is bank agnostic,
allowing Fiinu Bank to serve all other banks' customers. Open
Banking allows Fiinu's Plugin Overdraft(R) to attach ("plugin") to
the customer's 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 .
([1]) Fiinu Bank Limited obtained its UK deposit-taking banking
licence with restrictions from the Prudential Regulation Authority
(PRA) and with the consent of the Financial Conduct Authority (FCA)
in July 2022.
About GEM
GEM Global Yield LLC SCS, part of the Global Emerging Markets
Group, is a $4 billion, alternative investment group with offices
in Paris, New York, and Nassau (Bahamas). GEM manages a diverse set
of investment vehicles and has completed over 600 transactions in
70 countries.
For more information, please visit www.gemny.com
About Dewscope Limited
Dewscope Limited is a company of which Mark Horrocks is a
director and is an indirect beneficiary.
About Intrinsic Capital LLP
Intrinsic Capital LLP ("Intrinsic") is authorised by the
Financial Conduct Authority to provide general financial advice and
investment services across a wide range of strategies and
products.
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IOEUVURRONUOARR
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