Eight Capital Partners PLC (AQSE:ECP) (ECP) has announced plans to become a financial services operating company rather than an investment vehicle as it unveiled a comprehensive balance sheet restructuring and the appointment of a CEO.
The transformation has been sparked by the success of corporate advisory subsidiaries Epsion Capital and Innovative Finance.
Both have recently been advising on initial public offerings, reverse takeover transactions and mergers and acquisitions, along with other fundraising and corporate advisory activity.
“Much of the financial services advisory market only delivers third party capital and advice, without direct access to supportive in-house capital, or only having access to in-house capital lines with a less flexible mandate,” ECP said.
“The company has therefore moved away from a pure investing strategy to a financial services operating strategy whereby its clients' financial services transactions can be supported by in-house capital.”
The aim is to grow the business, which will be focused on the emerging fintech sector, to a market valuation of £50mln.
To do this it reorganising the balance sheet.
So, it will convert a €25mln of a €40mln vendor loan into equity. The outstanding sum will then be funded from a €15mln of 4.8% bond, although the coupon on this will be reduced to nil until the reorganisation is complete.
David Bull, a non-executive director and former Bank of England chief accountant, has agreed to become ECP's chief executive.
His mandate is to develop ECP's financial services businesses, as well as new lines of business, “both organically and through acquisition, all within the context of fintech services”.
Chairman Dominic White said: “We are pleased to have reached a point whereby we can provide more clarity about the short to medium-term plans for the company.
"The most progressive financial services businesses are deploying new technology in their operations which is not only impressive but also looks likely to dramatically change the industry in the coming years.
“We want to access, invest in and implement some of these technologies in our existing and future operating subsidiaries."