The founder of mobile banking and payments software firm Monitise, Alastair Lukies, is to step down from his role as co-CEO, following the conclusion of a strategic review that will see the company remain independent.
Monitise had announced that it would consider takeover offers in January, as it sought ways to hasten growth and capitalise on interest in mobile banking and payments.
The review of its business has now come to an end, with a statement from the company’s board today that “the best way of maximising long-term value for shareholders is to continue as an independent company”.
The company claimed it received “a number of expressions of interest” from various parties. It had previously been speculated that IBM, which has a close partnership with the payments firm, would be among those making a takeover bid.
Changes to senior leadership will see Lukies step down from the board and continue as a ‘strategic advisor’ reporting to Elizabeth Buse. Former Visa exec Buse, who joined the firm as co-CEO in 2014, will now lead the firm as its sole CEO.
The software provider has been struggling to complete a transformation of its business in recent months, after declaring last year that it would move to a subscription-based selling model. This is despite a number of customer wins and investment deals with Santander, Telefonica and Mastercard.
In its half year results the loss-making company warned that a previous 2015 revenue growth target of 25 percent would not be met, with revenues remaining flat at between £90-£100 million.
Licence revenues for the first six months almost halved, down 47 percent to £4.4 million, while integration income dropped 13 percent to £21.8 million. At the same time, subscription revenues grew slowly, up only eight percent to £16.2 million.
A number of steps have already been taken by Monitise to overhaul its business during the past year, including changes to key personnel – such as the appointment of Buse as joint CEO, alongside the hiring of Adam Banks, Visa's former CTO and global head of technology - and the departure of CIO Mike Keyworth.
TechMarketView financial services analyst, Peter Roe, commented that the conclusion of the internal business review could help the company achieve its transformation goals.
“Markets and management have been distracted by the Strategic Review and its early end is welcome,” he said.
“It will have been a useful exercise if Monitise emerges as a more tightly run operation that has pinpoint focus on achieving its goals and delivering shareholder value.”
The Monitise announcement comes amid wider change in the UK payments market this week, with Optimal Payments revealing that it would buy rival digital wallet company Skrill in a £800 million deal. Competition in the mobile payments market is heating up substantially, with the imminent launch of Apple Pay in the UK, alongside competiting offers from other tech giants such as Google and Samsung in the pipeline.
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