-RNS3 Nov 2022 07:52
equity, as follows:
i. In June 2022, following bondholder approval, ECP re-organised the Vienna Bonds 1 to align their commercial terms to that of its more recently issued listed Vienna bonds (ISIN GB00BP2PO741) ("Vienna Bonds 2"), notably at a lower coupon with a longer duration to July 2026, providing longevity to its bond financing.
ii. At the General Meeting in October 2022, approval of a waiver by shareholders under Rule 9 of the Takeover Code allowed its largest shareholder, IWEP Ltd, to increase its shareholding above 29.9% and beyond 51%, enabling it to convert Euros 3,150,000 of Company debt into equity at £0.0002 per share. A listed bondholder also agreed to convert Euros 145,000 of debt to equity at the same time on the same terms.
3. To grow the market capitalisation of the Company towards and beyond £50 million so that it establishes a strong balance sheet base from which to significantly expand its operations and its own equity valuation and therefore become increasingly attractive to investors.
As noted above, this announcement initiates the next step in the Company's transformational growth strategy being to:
i. launch a share placing process;
ii. offer new equity to existing shareholders; and
iii. offer holders of Vienna Bonds 1 and Vienna Bonds 2 the ability to convert their bonds into ECP equity, all on the same terms.
IWEP Ltd, the Company's major shareholder, remains committed to converting up to Euros 33 million of existing debt into new equity as the Company generates free-float headroom, with the issue of new shares via the Fundraise enabling it to do so.
Fintech Strategy
Following the Company's acquisition of Innovative Finance Srl in May 2021, the Board stated that ECP would re-energise its focus on financial services with particular attention being paid to fintech, decentralised finance and potentially crypto banking. The Board believes that the trend of major technological change in the way financial services are delivered will enable faster, cheaper, easier and more accessible financial services. Furthermore, there will likely be a fundamental change to the sector's landscape as a result of industry consolidation driven by new, more agile entrants.
The Directors believe that there is a particular opportunity within two areas of Fintech.
Firstly, the Directors' opinion is that is there is a large gap in SME financial service provision which remains under-served by the traditional financial services sector. It is the Directors' view that SMEs are sometimes over-looked by larger funding institutions or, where served and managed through a traditional banking approach, can be seen as difficult to underwrite and therefore expensive to fund. The Company believes there are significant benefits for SMEs in using "fintech" systems and innovatively structured capital markets finance solutions to better acces
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