TechFinancials confirms plans to 'streamline' future activities
By Josh White
Date: Friday 16 Oct 2020
(Sharecast News) - Fintech software provider TechFinancials updated the market on its current investing activities on Friday, announcing a review of its future investing involvement in the technology sector.
The AIM-traded firm reiterated that its brokerage services relating to B2B would terminate under its six-month notice termination period, as it indicated in May.
It said it expected all activities pertaining to the investment would be terminated by 1 November.
Looking at its investment in Footies, TechFinancials said it had decided to close the investment out due to the continuing negative impact of Covid-19.
It noted that it had signed a separation agreement, referred to in its May announcement, confirming that under the separation agreement, the company owned 100% of Footies intellectual property.
"Covid-19 has severely impacted the events market, with the sales of tickets to events severely disrupted, and anticipated to be severely disrupted well into 2021," the board said in its statement.
"TechFinancials will currently halt the development and marketing of the Footies solution."
On Cedex, the company said both itself and Cedex had recently involved in several business development activities that progressed, but did not mature to any signed agreements.
Given its current financial status and the current atmosphere in the diamond and financial industries, the company said it did not believe it would be able to realise Cedex's vision to issue the first diamond exchange traded fund on its own.
"Therefore, the company has decided to halt this activity."
TechFinancials said it was aiming to streamline its trading structure through the closure of all its subsidiary companies, which would assist in driving its running costs down.
To further reduce running costs, all employment agreements would also be terminated.
The board said Eitan Yanuv would continue to act as its non-executive chairman, and Asaf Lahav's role would immediately change from being the chief executive officer to executive director.
"The role changes are to reflect the nature of the company's investing activities, and as the company develops, the board will review its corporate governance obligations," the board said in its statement.
"The directors are committed to maintaining high standards of corporate governance, and propose, so far as is practicable given the company's size and nature, to comply with the QCA Code.
"Due to the size and nature of the company, audit and risk management issues will be addressed by the directors as a whole, rather than by separate committees."
With the company structure streamlined and costs reduced, TechFinancials said it was aiming to continue an investment strategy in the technology sector, as it had already begun a review of potential opportunities in the sector.
"The board believes that their combined strength and knowledge in the technology sector will serve the company well when deciding on potential investment opportunities.
"The company intends to use a combination of cash and equity to acquire stakes in companies."
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