eTranzact international PLC may have a capital raise on the horizon going by a recent notice sent to the Nigerian Stock Exchange.
In the notice, the firm stated that an Extraordinary General Meeting would hold on Thursday, January 17, 2019. The main agenda at the meeting is to obtain shareholders approval to raise additional capital to the tune of N7 billion.
Details of the proposed raise
The capital raised could either take the form of equity, debt, private placement or a combination that would be determined by the company’s board of directors.
eTranzact international would, however, be raising its authorized share capital from N2.1 billion divided into 4.2 ordinary shares of N0.50 each to N9.1 billion divided into 18.1 billion ordinary shares of N0.50 each by the creation of additional 14 billion ordinary shares.
Reasons for the proposed raise
In a separate notice to the NSE, the company shed more light on the reasons behind the proposed raise, and how the capital raised will be utilized.
The decision to raise additional capital became imperative considering the need of the Company to expand its operations, deepen its market share and to remain competitive in the financial technology industry.
The firm may also be considering an expansion of its operations to stay ahead of the new players in the fintech space.
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rapid development in the Electronic Payment System has led to the emergence of many key players and stiffer competition with the industry. The financial, technological, workforce and corporate governance requirements have also changed to an unprecedented level as a result of key reforms within the sector.
How the funds will be applied
According to the firm
The funding will be used to upgrade and enhance the Company’s technology infrastructure and network security systems and also to improve on its service delivery among other lawful purposes.
In addition, the company plans to invest in an agent network expansion Program, as well as human resources, and employee development.
eTranzact international closed at N3.95 in yesterday’s trading session on the Nigerian Stock Exchange, unchanged from the prior day.