Splitit Payments Ltd (Proposed ASX code: SPT) provides a cross-border credit card-based instalment solution to merchants that can be fully integrated into a merchant’s payment system. As on the date of the issuance of this prospectus, the company had a presence around the globe with more than 310 merchants in 25 countries and registered an average month on month growth in revenues of ~15% in the last 15 months. The company is headquartered in Israel and seeks to provide merchants with a way to increase their average order value and reduction of cart abonnement. Moreover, this platform provides customers with the ability to buy now and pay at a later stage, without incurrence of the interests and any additional late fees and charges.
The company will be providing this payment service that will be fully integrated into the merchant’s payment system whereby the payment option shall be provided by the platform at the checkout and the customers shall be provided with an option to split the payments related to purchase into various monthly instalments which will, in turn, have a positive impact on the purchasing power exercised by the customers.
Post raising this amount from the public issue; the Company intends to improve the user interface and the overall experience of the end customer by developing additional functionalities and applications with respect to its existing payments platform. This will also have an impact on the engagement with large scale merchants with a view to entering into strategic partnerships with certain merchants. The company will utilize the funds increasing the awareness of the Splitit brand via a focus on its sales and marketing, expanding its customer support services by increasing the number of customer support representatives. The funds procured from the IPO are anticipated to be heavily spent upon developing and improving the Splitit payment platform and system integration via the engagement of developers, satellite services and technical writers, the utilization of Amazon web services and the outsourcing of certain software developments;
The Company has released prospectus to issue 50,000,000 to 60,000,000 Shares at an issue price of A$0.20 per Share, to raise a minimum of A$10,000,000 and a maximum of A$12,000,000 (before associated costs). The offer for subscription is slated to close on the 31st of January 2019 at 5.00 pm AEST. The company anticipates to completing the allotment of shares to the applicants by 5 February 2019. Also, it is expected that the shares will be quoted on ASX around 7 February 2019, if the company’s application for listing is accepted by the ASX. The Lead Manager for the issue is Armada Capital.
Post the completion of this offer, the Total number of Shares on the issue shall be 259,655,661 and will have an indicative market capitalization of A$54 million. The Company’s pro forma statement of financial position as at 30 June 2018 has net assets of US$18,976,446 (being approximately A$26,727,388). The company’s main source of revenue is its transaction fees which are paid by its merchant clients in relation to customers who utilize the Splitit service on their website or store (Merchant Fees). Considering that the funds received from the IPO’s shall be used to fuel the growth and which in turn is expected to lead the company entering into engagement with large scale merchants; the transaction volumes are slated to increase going forth and the company will be able to generate constant growth in the merchant fees in the future.
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