Monitise, the technology company delivering mobile banking, payments and commerce networks worldwide, is further strengthening its alliance with Visa Europe, which is investing £24.7 million in Monitise at an issue price of 35p per share for 70.5 million new Monitise shares.
As part of the subscription for Monitise shares, Visa Europe President and Chief Executive Peter Ayliffe, will join Monitise’s Board of Directors.
Monitise also announces it has agreed to acquire the 51% stake in its US joint venture, Monitise Americas, held by Metavante Corporation, a subsidiary of Fidelity National Information Services Inc. (NYSE: FIS) (“FIS”). FIS is one of the world’s largest global providers dedicated to banking and payments technologies.
In consideration for the purchase, Metavante will be issued with a 3.3% stake in Monitise plc. Completion is conditional on shares being admitted to trading on AIM. This transaction continues the strong commercial relationship between FIS and Monitise and the two companies will continue working together to offer world-leading mobile money services to financial institutions in key markets.
Monitise’s acquisition of the 51% stake in Monitise Americas values that business at $29.4 million.
Following the Visa Europe subscription and the issue of shares to FIS, Visa Europe’s and FIS’s respective shareholdings in Monitise will be 8.8% and 3.3%. Both transactions are based on an issue price of 35p.
These key relationships with Visa Europe and FIS strengthen Monitise’s position as the platform of choice for mobile money in the key European and US mobile money markets. Monitise has an existing global alliance agreement with Visa Inc., which is an independent and separate company to Visa Europe, and today’s announcement results in both companies now having strategic investments in Monitise.
Monitise believes the market opportunities for its mobile technology business in Europe and North America and high-growth territories worldwide are greater today than at any time before. Monitise has a strong balance sheet to exploit opportunities where it assesses they will further enhance shareholder value.
Monitise Group Chief Executive Alastair Lukies commented:
“Visa Europe’s investment in Monitise, coupled with a deepening relationship eight months after our two companies first entered into a partnership, establishes our role as the platform of choice for mobile money services in Europe. We are excited by the opportunities ahead for Monitise and the global mobile money industry as mobiles increasingly become the accepted new way to bank, pay and shop.
Our evolved relationship with FISensures that Monitise is ideally placed to play a leadership role in the North American mobile money market, which is following similar trends of growth to those we have experienced in the UK over the past 12 months. It has always been our strategy to partner with the world’s leading companies in a way that ensures optimal value for our shareholders.
Monitise is evolving fast. In the summer of 2010, we announced a fundraising at 20.75p. At that time, we had live mobile banking platforms in the UK and US and anticipated further growth internationally, as well as substantial new opportunities emerging in both mobile payments and mobile commerce.
We have now established a clear and proven leadership position in the mobile money space. Our technology underpins services in mobile banking, payments and commerce for millions of consumers on four continents with the value of mobile transfers and payments alone running into billions of pounds per year and growing.”
Monitise Group Chairman Duncan McIntyre added:
“We look forward to working more closely with Visa Europe to develop innovative, bank-grade, value-creating payment solutions for its member banks and partners. We remain excited about our new relationship with FIS and how we are taking advantage of increasing opportunities in mobile money. The strength and breadth of the partnerships built over several years are key validations that our strategy is delivering for our clients and partners worldwide across developed, hybrid and emerging markets.
As we continue to grow our business, we are delighted to welcome Peter Ayliffe, President and Chief Executive of Visa Europe, to the Monitise Board of Directors. With such an extensive background across the banking and payments industries, Peter’s proven leadership and industry acumen will be a great asset as we increase our global footprint in mobile money.
Our strategy is to execute on the opportunities before us, creating value for our customers, partners and shareholders alike.”
Strategy of the Group
Monitise’s technology platform has been designed to deliver mobile banking, payments and commerce services anywhere in the world. The group’s aim is to be the platform of choice for banking and other financial institutions throughout the world. Having established itself and proven the technology in the UK, US, Asia Pacific, India and Africa, Monitise’s strategy is to continue to invest in its technology and to expand its reach, initially into other markets with high growth potential, by working with local and international partners who can provide the local infrastructure and international functionality where necessary.
Visa Europe Subscription
In February 2011, Monitise entered into a partnership agreement with Visa Europe to develop and supply mobile payments services for Visa Europe’s more than 4,000 member banks and financial institutions across 36 European countries. That partnership gives Visa Europe a licence to Monitise’s world-leading mobile technology. Monitise is acting as an advanced development engine for Visa Europe in a collaboration that will accelerate the deployment of large scale rapid go-to-market mobile payments and services in Europe.
The progress of that partnership has led to the deeper alliance and strategic investment announced today.
In September 2011, Visa Europe announced the launch of Visa Mobile Person-to-Person payments and Visa Alerts, two new services designed to help consumers manage their money and make payments using their mobile phones. The services were developed by Visa Europe in partnership with Monitise, the first of many services that Monitise expects to be made available through its European agreement with Visa Europe.
Visa Europe’s strategic investment in Monitise strengthens the Company’s partnership with Visa Europe. Visa Europe became independent of Visa Inc. in 2007 following a restructuring of the Visa Group and the subsequent IPO of Visa Inc.
As part of the Visa Europe Subscription, Visa Europe has the right to appoint a non-executive director to the Board of the Company for so long as it holds at least 50 million shares in the Company. Monitise is pleased to announce that Peter Ayliffe, President and Chief Executive of Visa Europe, will join the Board of the Company as a non-executive director. Prior to joining Visa Europe in 2006, Peter George Edwin Ayliffe, aged 58, previously spent more than 20 years with Lloyds TSB, a leading UK bank, where he held a number of executive posts in the bank’s retail business, culminating in his appointment as a group board director. Peter also spent five years as a non-executive director on the Visa Europe board. Peter was named Industry Personality of the Year at The Card Awards 2009.
There is no further information to be disclosed in accordance with Schedule 2 paragraph (g) of the AIM Rules in respect of Peter Ayliffe’s appointment.
Monitise Americas Acquisition
Monitise has entered into an agreement with Metavante Corporation, a subsidiary of FIS, which is one of the world’s largest technology providers to the banking industry, to acquire the 51% stake in Monitise Americas not currently held by the Monitise group for consideration of $15.0 million. The consideration will be satisfied by the issue to Metavante of 26,785,714new ordinary shares in Monitise.
FIS provides wide coverage of financial institutions throughout the US, and has been a successful channel for Monitise Americas to access this marketplace, processing nearly 100 million prepaid cards annually while its financial technology solutions support more than 2,800 core processing customers.
Since Monitise Americas was formed as a joint venture in 2007 between Monitise and FIS, the business has grown to provide mobile services to more than 250 US financial institutions from offices across the US.
The Monitise platform provides US banks and consumers with a full range of mobile services providing them with the ability to manage their debit, prepaid and healthcare cards. Whether via text message, mobile web browser or bespoke applications for iPhone, Android and Blackberry smartphones, consumers can access account information, move money between their accounts, pay bills and make person-to-person payments, supported by a full range of account alerts to help them manage their finances. Monitise has also recently completed deployment of live NFC payment services in association with Visa Inc. and US Bank.
With today’s announcement, Monitise is simplifying and streamlining the group’s structure and securing full ownership of its business operations in the US, one of the world’s leading mobile money markets. This comes as the global mobile money market accelerates and financial institutions of all sizes increasingly look to offer mobile banking services and innovations that meet their customers’ evolving needs.
Use of Proceeds
Over the past year Monitise has further strengthened its position in the global mobile money market which continues to grow rapidly. Monitise has continued to demonstrate its technical ability to provide bank-grade secure services for mobile banking, mobile payments and mobile shopping to its customers. These services are delivered via operations across developed, emerging and hybrid markets.
This growth is reflected in the sharp rise in new business across the Monitise group and comes after Monitise’s live operations reached profitability in the year ended June 2011, one year ahead of target. At the end of June 2010, Monitise’s order book was £13m. As at 1 September 2011, when Monitise published its results for the year to end-June 2011, the order book was six times greater at £78m. After doubling revenues in the year ended June 2011, the group is on track to double revenues again in the year ending June 2012 and achieve cash break-even by the end of calendar 2013.
Monitise continues to invest in the business where it sees opportunities to grow shareholder value. These include investments in India, Asia Pacific, emerging markets and in mobile commerce.
Evolving the group’s joint venture in North America into a wholly-owned subsidiary, as Monitise did with its Monilink joint venture in the UK in 2009, is an example of one such opportunity.
Monitise believes the mobile money market opportunities are enormous. The £24.3 million net raised from this strategic investment means that Monitise is not cash constrained in investing in these growing opportunities where it assesses shareholder value will be enhanced.
As Monitise assesses and undertakes new investment opportunities in its target markets and across banking, payments and commerce, the Company will update the market as necessary if there is any impact on its forward-looking targets.
Total Voting Rights
Application will be made to the London Stock Exchange for the admission of the 97,285,714 new ordinary shares to be issued to Visa Europe and FIS and it is expected that Admission will occur on 4 November 2011. The new shares will, when issued, rank pari passu in all respects with the existing ordinary shares of 1p each in the Company following Admission.
Following the issue of the new shares to Visa Europe and FIS, the Company will have 804,149,904ordinary shares of 1p each in issue.
Monitise plc (LSE: MONI.L) is a technology company delivering mobile banking, payments and commerce networks worldwide with the proven technology and expertise to enable financial institutions and other service providers to offer a wide range of services to their customers in developed and emerging markets.
With live services in the UK, the US, India and Africa, the company is working with international partners to extend trusted and secure mobile banking, payment and commerce services in territories worldwide, including Europe, Asia Pacific and Latin America. Monitise has a global alliance agreement with Visa Inc. and a strategic partnership with Visa Europe. Other leading partners and clients include FIS, RBS, NatWest, HSBC, Lloyds Banking Group, First Direct, U.S. Bank, Ulster Bank, Standard Chartered Bank, Travelex, Vocalink, Vodafone, Orange, O2, T-Mobile, 3 UK, Research In Motion, Best Buy Europe, The Carphone Warehouse, First Eastern, Astra, JETCO and PCCW mobile.
More information is available at www.monitisegroup.com.
About Visa Europe
In Europe, there are 438 million Visa debit, credit and commercial cards. In the 12 months ending June 2011 those cards were used to make purchases and cash withdrawals to the value of €1.7 trillion. 12.5% of consumer spending at point of sale in Europe is with a Visa card, and more than 70% of that is on Visa debit cards.
Visa Europe is owned and operated by more than 4,000 European member banks and was incorporated in July 2004. In October 2007, Visa Europe became independent of the new global Visa Inc., with an exclusive, irrevocable and perpetual licence in Europe. As a dedicated European payment system it is able to respond quickly to the specific market needs of European banks and their customers – cardholders and retailers – and to meet the European Commission’s objective to create a true internal market for payments.
Visa enjoys unsurpassed acceptance around the world. In addition, Visa/PLUS is one of the world’s largest global ATM networks, offering cash access in local currency in over 200 countries.
For more information, visit http://www.visaeurope.com.
FIS (NYSE: FIS) is the world’s largest global provider dedicated to banking and payments technologies. With a long history deeply rooted in the financial services sector, FIS serves more than 14,000 institutions in over 100 countries. Headquartered in Jacksonville, Fla., FIS employs more than 33,000 people worldwide and holds leadership positions in payment processing and banking solutions, providing software, services and outsourcing of the technology that drives financial institutions. First in financial technology, FIS tops the annual FinTech 100 list, is ranked third on the Barron’s 500, 426 on the Fortune 500 and is a member of Standard & Poor’s 500® Index.