24 September 2017
visit www.avoka.com

Monitise failings exposed as Fiserv lays down terms

03 July 2017  |  5885 views  |  1 Stock market graph on screen

Agreed terms for a £70 million acquisition of Monitise by Fiserv reveal the scale of the challenges facing the once hotly-tipped UK mobile banking firm, which had failed to find a single buyer for its 'next-generation' FINkit software package.

Once valued at £1 billion, Monitise has been on a continuous downward spiral, issuing multiple revenue warnings and failing to turn a profit in its ten years as a listed company.

The firm posted widening losses of £243 million in its latest set of accounts to end-June 2016, reporting depressed revenue and a dwindling cash pile.

Having undergone multiple pivots over the years, Monitise was betting big on its FINkit software platform to turn the tide. However, despite its release in 2015, the firm has failed to find a single buyer for the package as banks turned away from its tarnished brand.

In the scheme documents for the proposed takeover, Fiserv lays bare the problems facing the company: "The challenges that the Company has experienced in seeking its first FINkit contract include: (i) the long and complex sales cycle when engaging with large financial institutions, (ii) customers’ perception of Monitise’s size and financial wherewithal compared to its customers and peers, (iii) the Company’s ability to continue to invest in and support FINkit given its current cash balance and usage, (iv) its position and history as a pioneer, compared to new and emerging FinTech competitors, and (v) the overall increased competition as the market in digital financial services evolves."

Shareholders in Monitise have railed against the 2.9 pence per share price offered by Fiserv, threatening to withdraw support for the bid in the absence of a more meaningful valuation. To this suggestion, Fiserv spells out the unappetising alternatives: "The Board recognises the growth challenges the Group as a whole continues to face were a transaction with Fiserv not to take place, and in the likely absence of any material FINkit signings in the near term the board will need to consider raising further capital, the divestment of businesses and the overall strategy of the Group."

Comments: (1)

Ketharaman Swaminathan
Ketharaman Swaminathan - GTM360 Marketing Solutions - Pune | 04 July, 2017, 13:17

Shareholders in Monitise must be wondering how come the Amazons and the Ubers keep making losses yet their valuations keep ballooning whereas Monitise does the same but its valuation nosedives from £2B* to £70M.

*: While this article mentions Monitise's peak valuation as £1B, a previous article (https://www.finextra.com/newsarticle/30685/fiserv-to-acquire-monitise-for-70-million) had reported the higher figure of £2B.

Be the first to give this comment the thumbs up 0 thumb ups! (Log in to thumb up)
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

Fiserv to acquire Monitise for £70 million

Fiserv to acquire Monitise for £70 million

13 June 2017  |  8652 views  |  2 comments | 20 tweets | 20 linkedin
Monitise ends plan to sell content biz

Monitise ends plan to sell content biz

01 June 2016  |  5611 views  |  3 comments | 2 tweets
Monitise shares shift up on talks of content business sale

Monitise shares shift up on talks of content business sale

04 March 2016  |  6482 views  |  1 comments | 3 tweets
Visa ices Indian mobile finance project

Visa ices Indian mobile finance project

22 September 2015  |  7262 views  |  1 comments | 7 tweets | 5 linkedin
Monitise CEO Buse to step down as losses rack up

Monitise CEO Buse to step down as losses rack up

09 September 2015  |  5529 views  |  1 comments | 5 tweets | 3 linkedin
Visa Europe to sell Monitise stake

Visa Europe to sell Monitise stake

08 July 2015  |  6586 views  |  0 comments | 12 tweets | 10 linkedin
Monitise shifts strategy as revenues dip

Monitise shifts strategy as revenues dip

06 July 2015  |  4305 views  |  0 comments | 6 tweets | 4 linkedin
Lukies out as Monitise pulls back from sell off

Lukies out as Monitise pulls back from sell off

25 March 2015  |  5919 views  |  2 comments | 3 tweets | 3 linkedin
Monitise losses widen as suitors circle

Monitise losses widen as suitors circle

17 February 2015  |  4943 views  |  0 comments | 5 tweets | 4 linkedin
Monitise puts itself up for sale;  warns on full year revenues

Monitise puts itself up for sale; warns on full year revenues

22 January 2015  |  11477 views  |  4 comments | 15 tweets | 12 linkedin
Monitise shares plunge as Visa ponders stake sell-off

Monitise shares plunge as Visa ponders stake sell-off

18 September 2014  |  7420 views  |  1 comments | 4 tweets | 5 linkedin
Monitise revenues rise but losses grow

Monitise revenues rise but losses grow

15 September 2014  |  4900 views  |  0 comments | 7 tweets | 3 linkedin
Monitise slashes revenue outlook

Monitise slashes revenue outlook

08 July 2014  |  5532 views  |  0 comments | 2 tweets | 3 linkedin
Monitise revenues soar but losses widen

Monitise revenues soar but losses widen

05 September 2013  |  7362 views  |  0 comments | 1 tweets
Monitise revenues soar as profitability lags

Monitise revenues soar as profitability lags

23 July 2013  |  5437 views  |  1 comments | 4 tweets | 3 linkedin

Related company news

 

Related blogs

Create a blog about this story (membership required)
visit www.temenos.comvisit www.capgemini.comdownload the paper now

Top topics

Most viewed Most shared
HSBC switches on selfie payments in ChinaHSBC switches on selfie payments in China
13392 views comments | 28 tweets | 44 linkedin
AXA launches blockchain to cover late flight compensationAXA launches blockchain to cover late flig...
9743 views comments | 13 tweets | 28 linkedin
Apple P2P payments service nears launchApple P2P payments service nears launch
8591 views comments | 19 tweets | 27 linkedin
SBI Ripple Asia advances on South KoreaSBI Ripple Asia advances on South Korea
8365 views comments | 16 tweets | 1 linkedin
European Commission makes fintech a priority in supervisory shakeupEuropean Commission makes fintech a priori...
8076 views comments | 32 tweets | 45 linkedin

Featured job

Competitive
London, UK (or flexible)

Find your next job