ayondo, a financial technology group, said on Wednesday it is in advanced negotiations with a company listed on the Singapore Exchange (SGX) on a reverse takeover (RTO) deal. The fintech will merge with the listed company and the new entity will be listed under the ayondo name on the SGX, the fintech said without disclosing the name of the other company.
RTO, also known as reverse initial public offering (IPO) or reverse takeover, occurs when a private company becomes exchange-listed by merging with or acquiring a publicly traded company, skipping the IPO-related processes. Unlike IPO, however, the completion of an RTO does not contribute with newly-collected funds.
Under the agreement, the new group will be fully controlled and managed by ayondo, the shareholders of which will have control over 75% of the new group. The new group’s market capitalization is estimated at SGD 210 million, or about $155.4 million, which includes a financial injection of substantial fresh capital, ayondo also said, without specifying the funds’ amount or origin.
The proposed deal is subject to to the approval of shareholders. If ayondo’s plans go through, it will become the first SGX-listed fintech company via an RTO. The fintech said it chose an RTO model over the traditional IPO, since it provides greater certainty (think raised funds and valuation) in high volatile financial markets like the current ones, since it is insignificantly affected by market changes.
“We are extremely excited about our proposed Singapore listing as this will provide an excellent platform to accelerate growth and brand awareness globally, Asia in particular. The new group will be financially powerful and will enable us to continue to execute our ambitious plans,” ayondo group CEO Robert Lempka said.
The listing will provide ayondo with a platform to execute its future growth plans. The broker intends to use the net proceeds from the potential RTO to finance its existing business and enhance its mobile technology. This indicates that the above-mentioned fresh capital might be provided by ayondo’s unnamed partner.
Moreover, listing on the exchange in Singapore will be a milestone in ayondo’s expansion in Asia. The fintech already has an Asian unit (ayondo Asia Pte. Ltd.) and an office based in Singapore, as well as a Singapore-based shareholder, Luminor Capital Pte. Ltd.
“This maiden hintech listing will be a milestone for Singapore’s equity market and we anticipate that investor participation will be active and sustained. We believe that social trading will be one of the key online financial services platforms of the future and ayondo is well positioned to become one of the global leaders in this field,” said Foo Fatt Kah, Luminor Capital Pte. Ltd.’s co-founder and managing director.
Germany-based ayondo group is a provider of social trading, spread betting, and trading in contracts for difference (CFDs) on forex, commodities, indices and stocks. It provides its own proprietary white-label trading platform TradeHub. The group serves clients in 195 countries worldwide. Trade execution services are provided exclusively by UK-regulated ayondo markets Ltd., while social trading services are offered by ayondo GmbH.