16 August 2017
visit www.avoka.com

Dexit cuts staff; explores sale

21 July 2006  |  4250 views  |  0 globes - map of earth

Canadian small value payments firm Dexit is laying off almost half its staff and scaling back operations as it explores 'strategic options' for the business.

In a statement the vendor says in response to "overtures from several potential strategic investment partners" it is reviewing strategic options and has hired US financial advisor Kirchner to manage the process.

The options may include partnerships, business combinations and investments.

At the same time the company is reducing the number of staff from 55 to under 30, realigning product development, reducing rent and other overhead costs and cutting resources in non-core areas.

Dexit is also reducing the number of locations in and around Toronto where consumers can use the Dexit rechargeable token for electronic payments.

John McBride, CEO of Dexit, says: "We believe this initiative will enable the company to realise higher value for its significant technology investment to date and focus our people and financial resources on key opportunities."

Formed in 2001, Dexit launched its e-payment tag in Toronto in 2003. More than 450 merchant locations were accepting its tag payments by December 31 2005, and more than 50,000 consumers were registered for the service.

But the company has failed to turn a profit. For the fiscal year ended December 31 2005, revenue was C$4.7m, while net losses came in at $6.7 million. For the first quarter of this year the firm reported revenue of C$859,941 and a net loss of C$1.87 million.

Worryingly, in today's statement, Dexit says that "substantially all" of its year-to-date reported revenue was from a licence and exclusivity deal with Bell Canada.

That agreement expired last month and Dexit says the two companies "continue to negotiate in good faith", but there is assurance that an agreement will be reached. If a deal is reached, Dexit says it will be "substantially different" from the original licensing deal.

The vendor does say that it will receive no revenue from the Bell Canada partnership for the second quarter this year.

Comments: (0)

Comment on this story (membership required)

Finextra news in your inbox

For Finextra's free daily newsletter, breaking news flashes and weekly jobs board: sign up now

Related stories

Dexit targets US market with SST alliance

Dexit targets US market with SST alliance

11 March 2005  |  4624 views  |  0 comments
Dexit eyes international expansion as first half losses quadruple

Dexit eyes international expansion as first half losses quadruple

11 August 2004  |  3484 views  |  0 comments

Related company news


Related blogs

Create a blog about this story (membership required)
download the paper nowvisit www.dorsum.euvisit www.worldpaymentsreport.com

Top topics

Most viewed Most shared
hands typing furiouslyBI and Analytics - A New Perspective
10913 views 0 | 2 tweets | 12 linkedin
Coinbase raises $100mCoinbase raises $100m
9991 views comments | 14 tweets | 14 linkedin
DBS Bank launches online car selling marketplaceDBS Bank launches online car selling marke...
9371 views comments | 13 tweets | 11 linkedin
China preps central clearing house for mobile payments providersChina preps central clearing house for mob...
9067 views comments | 8 tweets | 15 linkedin
HSBC automates documentary trade processing with IBMHSBC automates documentary trade processin...
8207 views comments | 6 tweets | 21 linkedin