RNS Number : 6386H
Vela Technologies PLC
04 December 2020
 

Prior to publication, the information contained within this announcement was deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 ("MAR"). With the publication of this announcement, this information is now considered to be in the public domain.

4 December 2020

Vela Technologies plc

("Vela" or "the Company")

 

£200,000 investment in Cornerstone FS plc

 

The Board of Vela (AIM: VELA) announces that it has entered into a subscription agreement to invest £200,000 in Cornerstone FS plc ("Cornerstone"), a cloud-based foreign exchange and international payments platform, as part of a private funding round by Cornerstone to raise approximately £880,000. The funding round is expected to conclude shortly.

Further information on Cornerstone

Cornerstone is focused on the provision of cross border payment services for SMEs. On 9 September 2020, Cornerstone acquired FXPress Payment Services Limited ("FXPress"), following approval by Cornerstone shareholders and approval by the Financial Conduct Authority of the change of control in FXPress.

Cornerstone is a provider of advanced foreign exchange and international payment systems to SMEs. Cornerstone uses its proprietary technology platform to provide the payment services and, since 2018, has been actively building its trading business and client base. For the 9 months ended 31 December 2019, FXPress generated revenue of £1.24 million and recorded a net loss of £0.08 million. As at 30 June 2020, FXPress had unaudited net assets of £117,439.

The funds being raised by Cornerstone will support its operations and capitalise on market growth drivers to scale up its business.

Details of the subscription

Vela has entered into a subscription agreement with Cornerstone by which it has agreed to invest £200,000 in Cornerstone from the Company's existing cash resources. Vela has subscribed for 400,000 new ordinary shares of 0.01 pence each in Cornerstone at a price of 50 pence per ordinary share, valuing Cornerstone at £8.3 million. In addition, Cornerstone has issued Vela with 400,000 warrants with a 5-year term, each warrant carrying the right to subscribe for one Cornerstone share at a price of 50 pence.

Following completion of the funding round, Vela will hold 400,000 ordinary shares in Cornerstone, representing 2.4 per cent. of Cornerstone's share capital.

James Normand, Executive Director of Vela, commented:

"Cornerstone is pursuing an exciting strategy to consolidate this highly fragmented section of the financial services market using its proven proprietary technology to deliver scale efficiencies. We believe that its vision to deliver a streamlined payments solution to SMEs will ensure success and high growth."

Further announcements will be made by the Company at the appropriate time.

For further information, please contact:

Vela Technologies plc

Brent Fitzpatrick, Non-Executive Chairman

James Normand, Executive Director

 

Tel: +44 (0) 7421 728875

Allenby Capital Limited (Nominated Adviser and Joint Broker)

Tel: +44 (0) 20 3328 5656

Nick Athanas/Asha Chotai

 


Peterhouse Capital Limited (Joint Broker)

Lucy Williams / Duncan Vasey / Eran Zucker

Tel: +44 (0) 20 7469 0930

 

About Vela Technologies   

 

Vela Technologies (AIM: VELA) is an investing company focused on early stage and pre-IPO long term disruptive technology investments. Vela's investee companies have either developed ways of utilising technology or are developing technology with a view to disrupting the businesses or sector in which they operate. More recently, Vela Technologies has also started to focus on existing listed companies where valuations may offer additional opportunities.

 

About Cornerstone

Cornerstone (www.cornerstonefs.com) is an SME focused, cloud-based provider of international payment, currency management and electronic account services focused on removing the complexity of international payments for customers.  

Its in-house software development team has built its own proprietary cloud-based multi-currency payment services platform, through which it provides foreign exchange services to SME clients, giving them access to wholesale foreign exchange rates at prices well below that of the mainstream banks. Cornerstone also provides a white label solution which can be branded by other payment service providers. In the 9 months to 31 December 2019 it transacted over £1 billion of foreign exchange transactions. It is authorised and regulated by the FCA and by HM Revenue & Customs in respect of anti-money laundering regulations.

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