Future FinTech and Spondula Signed Term Sheet for Potential Acquisition
Future FinTech Group has announced that it has signed a term sheet with Spondula, a company incorporated in the United Kingdom. Pursuant to Term Sheet, the Company plans to acquire 51% of the total issued and outstanding shares of Spondula.
The Term Sheet is non-binding except for the "Exclusivity", "Confidentiality" and "Governing Law" sections, Future FinTech reported in a press release.
According to the Term Sheet, FTFT or its subsidiary will acquire 51% of the total issued and outstanding shares of Spondula through a share exchange with the shareholder of Spondula.
Spondula is located in the UK and it operates a global banking and money transfer platform serving both individuals and businesses. It has three subsidiaries, Plat Wallet ltd, Plat Mint Ltd, and Nero Inc, will operate utilising licenses from the European Union, United Kingdom, Singapore, Switzerland and offshore banking licenses from the Commonwealth of Dominica
Its services cover from simply opening a free account to a full blown private banking service. The Spondula platform allows customers to receive payments instantly from anywhere globally in up to 37 currencies and to exchange these payments efficiently and cheaply to their local currency. Customers can also have a multi-currency payment card, which can hold up to 37 currencies, reports Future FinTech.
According to Term Sheet, the acquisition price is expected to be USD3.06 million and the consideration will be paid in FTFT's common stock, and the price of FTFT's common stock will be based on the average closing price of FTFT's common stock on the Nasdaq for the 10 trading days prior to the signing date of the definitive agreement.
The parties also agreed to set rules for Valuation Adjustment Mechanism. If Spondula's audited earnings before taxes and amortisation (EBTA) in 2021 are less than USD3 million, the purchase price will not be adjusted. If Spondula's audited EBTA exceeds USD3 million in 2021, the purchase price will be increased according to certain adjustment formula agreed by the parties.
Shanchun Huang, Chief Executive Officer, Future FinTech, said: “Although the Covid pandemic is raging around the world, our acquisition strategy still carries on. We are actively looking for suitable acquisition targets around the world. However, due to the impact of Covid, the due diligence processes have been slow and difficult, and local government approvals are also slower than usual, which has impacted our progress.”
“With the acquisition of Spondula, FTFT will implement its strategy entering into the business of global challenger banking and payment system. Also, upon and after we complete the potential transactions that we are currently in discussion, we plan to reorganise these businesses, technologies and platforms, and integrate them into one platform and system, which will help us build a global innovative financial service system in a short period of time. We hope that individual customers can use our system to open accounts, make deposits, payments, transfers and exchange currencies with our system by using their mobile phones; and business customers can complete the above transactions and also receive credit line, borrow money, and apply for letters of credit through our website and mobile apps. Compare to traditional bank, Challenger bank customers can open an account on a mobile phone in just a few minutes. Many of services are free, or have far lower fees than traditional banks. We will also develop customer communities so that customers from different countries can exchange investment experiences and business information with each other, and promote cooperation and exchanges,” Huang continued.
Olena Drukar, CEO, Spondula, said: “The management and technical team of Spondula has extensive experience in the financial services field. The transaction with FTFT can help rapidly grow our business and enhance our core competitiveness. FinTech promotes innovation in banking business through the integration of new technologies. Leadership in technology and technological innovation is the core to continuously improving our customer experience and satisfaction. We are trying our best to improve the banking experience through providing services to meet the different needs of our customers. We can only establish our customers trust by providing a value proposition and growing and developing together with our customers.”