Monitise PLC (MONIF)

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Monitise rejects sale options, but founder out


Once-hot tech company Monitise has decided not to sell itself, but a strategic review of its "options" has led to its founder and co-CEO Alistair Lukies stepping down from the top job and board.

Mr Lukies will now merely be a "strategic adviser" to Elizabeth Buse, who becomes the sole chief executive of the troubled mobile money company.

Monitise at the start of the year hired Moelis, the investment bank, to examine "all options" for the company - including a sale – alongside a strategic review by the board.

The company, whose services enable businesses and consumers to carry out banking and payments on mobile devices, insisted that it had received "a number of expressions of interest from various parties". But the board decided they were not attractive enough, Monitise continued, despite it tripling its losses in the second half of last year.

…the Board concluded that none of these indicative and non-binding proposals fully recognised the longer-term value of Monitise. The expressions of interest were also structured in such a way that there was considerable uncertainty over their ultimate deliverability. The Board was also mindful that the Strategic Review should conclude within an acceptable timeframe; such that it did not interfere unduly with ongoing business opportunities, client services and discussions with partners and clients.

Aside from the ejection of its founder from the c-suite and board, Monitise reiterated its guidance on revenue (£90-£100m) and loss (£40m-£50m) this year, and breaking even in 2016, and revealed its plans to return to health.

From the statement:

Monitise's focus will be on sales in Europe, the Middle East and North America. Additional market opportunities will be pursued where they directly support partner needs.
Cost optimisation projects already announced, including the transition of UK professional services employees to IBM, and streamlining benefits from the shift to being a product-led business such as a narrowing of development focus to core products, to be supplemented by new initiatives, including centralising its R&D from a hub in Istanbul.
Action underway to improve profitability of under-performing businesses and exit non-core business areas.
Initial Monitise Central Platform Bank and Pay capabilities launching in April with additional functionality to follow driven by customer demand.
Transition to recurring-revenue driven business underway, building on strong client and partner relationships, internal expertise, and solid balance sheet, as outlined most recently at the 17 February 2015 Capital Markets Day.

http://www.ft.com/fastft/298083/monitise-rejects-sale-options-but-founder-out