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Clear Leisure acquires 20pc of Italy crowdfunding platform ForCrowd
3rd Oct 2019 14:55
(Sharecast News) - Clear Leisure announced the acquisition of a 20% interest in Italy-based equity crowdfunding platform ForCrowd on Thursday, reporting that consideration of £0.19m would be settled by the issue of 54,218,847 new ordinary shares at a price of 0.3482p each.
The AIM-traded firm said that was a 74% premium on the mid-market closing price on 2 October, and less than two-times ForCrowd's next three years average forecast revenues, which the board said compared "very favourably" to a revenue multiple of 5.5x used to value a crowdfunding platform recently admitted to trading on AIM Milan.
As part of the terms of the investment, Clear Leisure would be entitled to a referral fee on all clients and investors it introduced to ForCrowd.
The referral fee would be 1% of the total amount raised for any projects Clear Leisure introduced to ForCrowd, and it added that it would receive an additional 3% of funds invested into a project by an investor introduced by the company.
"The investment in ForCrowd is instrumental to the technology investment strategy of the company since it provides a platform to co-fund Clear Leisure's technology investments while providing immediate returns due to the fee structure in place between ForCrowd and Clear Leisure," said Clear Leisure chairman and chief executive officer Francesco Gardin.
"Moreover, the Company envisages situations where it can convert its fees into equity of a target company, as a route to growing its technology portfolio.
"We believe that the combination of issuing shares at a 74% premium to the current share price combined with a low purchase price multiple, will create a potential added value for our shareholders."
The AIM-traded firm said that was a 74% premium on the mid-market closing price on 2 October, and less than two-times ForCrowd's next three years average forecast revenues, which the board said compared "very favourably" to a revenue multiple of 5.5x used to value a crowdfunding platform recently admitted to trading on AIM Milan.
As part of the terms of the investment, Clear Leisure would be entitled to a referral fee on all clients and investors it introduced to ForCrowd.
The referral fee would be 1% of the total amount raised for any projects Clear Leisure introduced to ForCrowd, and it added that it would receive an additional 3% of funds invested into a project by an investor introduced by the company.
"The investment in ForCrowd is instrumental to the technology investment strategy of the company since it provides a platform to co-fund Clear Leisure's technology investments while providing immediate returns due to the fee structure in place between ForCrowd and Clear Leisure," said Clear Leisure chairman and chief executive officer Francesco Gardin.
"Moreover, the Company envisages situations where it can convert its fees into equity of a target company, as a route to growing its technology portfolio.
"We believe that the combination of issuing shares at a 74% premium to the current share price combined with a low purchase price multiple, will create a potential added value for our shareholders."