TIDMBANK
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(R),
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
GBP1.9 million, having repaid the GBP750,000 principal (and unpaid
interest of GBP7k) 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 GBP35m - GBP42m. 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(R) 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
Chris Sweeney, Chief Executive Officer office for Fiinu)
www.fiinu.com
SPARK Advisory Partners Limited (Nomad) Tel: +44 (0) 203 368 3550
Mark Brady / Adam Dawes
SP Angel Corporate Finance LLP (Joint Tel: +44 (0) 207 470 0470
Broker)
Bruce Fraser / Ezgi Senturk
Panmure Gordon (UK) Limited (Joint Tel: +44 (0)207 886 2500
Broker)
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(R) which is an unbundled overdraft solution that
allows customers to have an overdraft without changing their
existing bank. The underlying bank Independent Overdraft(R)
technology platform is bank agnostic, that therefore enables it to
serve all other banks' customers. Open Banking allows Fiinu's
Plugin Overdraft(R) 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
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END
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Fiinu (LSE:BANK)
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