17 December 2017
visit www.ebaday.com

Monitise failings exposed as Fiserv lays down terms

03 July 2017  |  6234 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  |  9312 views  |  2 comments | 20 tweets | 20 linkedin
Monitise ends plan to sell content biz

Monitise ends plan to sell content biz

01 June 2016  |  5688 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  |  6557 views  |  1 comments | 3 tweets
Visa ices Indian mobile finance project

Visa ices Indian mobile finance project

22 September 2015  |  7324 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  |  5585 views  |  1 comments | 5 tweets | 3 linkedin
Visa Europe to sell Monitise stake

Visa Europe to sell Monitise stake

08 July 2015  |  6672 views  |  0 comments | 12 tweets | 10 linkedin
Monitise shifts strategy as revenues dip

Monitise shifts strategy as revenues dip

06 July 2015  |  4359 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  |  5976 views  |  2 comments | 3 tweets | 3 linkedin
Monitise losses widen as suitors circle

Monitise losses widen as suitors circle

17 February 2015  |  5031 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  |  11542 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  |  7474 views  |  1 comments | 4 tweets | 5 linkedin
Monitise revenues rise but losses grow

Monitise revenues rise but losses grow

15 September 2014  |  4971 views  |  0 comments | 7 tweets | 3 linkedin
Monitise slashes revenue outlook

Monitise slashes revenue outlook

08 July 2014  |  5595 views  |  0 comments | 2 tweets | 3 linkedin
Monitise revenues soar but losses widen

Monitise revenues soar but losses widen

05 September 2013  |  7427 views  |  0 comments | 1 tweets
Monitise revenues soar as profitability lags

Monitise revenues soar as profitability lags

23 July 2013  |  5492 views  |  1 comments | 4 tweets | 3 linkedin

Related company news

 

Related blogs

Create a blog about this story (membership required)
visit www.ebaday.comvisit www.niceactimize.comvisit www.thomsonreuters.info

Top topics

Most viewed Most shared
satelliteRipple completes XRP Lockup
10661 views comments | 3 tweets | 2 linkedin
PSD2: Laying the regulatory foundation for a new age in paymentsPSD2: Laying the regulatory foundation for...
10310 views comments | 18 tweets | 36 linkedin
Banks tap Ethereum smart contracts for MiFID II complianceBanks tap Ethereum smart contracts for MiF...
7731 views comments | 10 tweets | 10 linkedin
Banks and fintech startups join forces on blockchain-based supply chain pilotBanks and fintech startups join forces on...
7362 views comments | 19 tweets | 22 linkedin
hands typing furiouslyReshaping Customer Engagement & Da...
6784 views 0 | 4 tweets | 2 linkedin

Featured job

Competitive base + commission + benefits
New York City, NY - USA

Find your next job