TruFin PLC (AIM:TRU) rallied 6% to 66.4p after the company rejected a £26mln offer for its subsidiary Oxygen Finance Limited.
The board believes the non-binding, indicative offer undervalues the business and prospects of Oxygen, Trufin said in a statement.
Oxygen is the company's software and lending solutions subsidiary and recently surpassed £1bn in early payments to small and micro businesses via FreePay.
Since launching in 2017, FreePay has enabled Oxygen's public sector clients to pay more than 400,000 invoices early and for free, improving cash flow and reducing financing costs to over 10,000 suppliers in their local economies, TruFin said.