(Alliance News) - Travelex currency exchange brand owner Finablr PLC on Monday confirmed that the UK Financial Conduct Authority has agreed to temporarily suspend trading in its shares.
On Thursday last week, Finablr announced "urgent" steps to look into liquidity and cash flow.
As part of "a package of urgent measures", Finablr said on Monday that Chief Executive Promoth Manghat will step down, but will continue to support the company while it finds a suitable successor.
Finablr said it will immediately commission a search for a new CEO, to be in place as soon possible.
The move follows a number of issues, the Abu Dhabi-headquartered company said, including the spread of Covid-19 around the world, a recent credit downgrade on Travelex's bonds, a liquidity squeeze, and a perception in the market that NMC Health PLC's governance problems also apply to Finablr.
The worldwide spread of Covid-19, which was declared a pandemic by the World Health Organization on Wednesday last week, together with government-imposed travel bans, has reduced demand for foreign exchange and payment services, much of which are offered at airports.
Finablr's co-chair, Bavaguthu Raghuram Shetty, is also a founder of NMC Health. Both firms have been looking into the true nature of Shetty's holdings in each company.
NMC Health announced on Tuesday last week the discovery of USD2.7 billion of debt of which the board had not been aware. Former chief executive Prasanth Manghat was fired in February over discrepancies in company finances.
On Monday, Finablr said these constraints have become amplified and have now reached a point where they are having a "material adverse impact" on its operations, including the company no longer being able to provide certain payment processing services.
Thus, Finablr said it has established a committee of its independent non-executive directors to carry out a comprehensive review of the company's liquidity and cashflow management functions, its financial and debt position, and its strategic options.
Finablr, which also had to deal with a major cyber attack at the start of the year, said it appointed risk consulting firm Kroll Inc to carry out a more comprehensive review of related-party transactions and on and off-balance-sheet debt, including the issues identified above regarding the cheques and any other contingent liabilities
By Evelina Grecenko; evelinagrecenko@alliancenews.com
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