Catena Group PLC Agreement to acquire upto 30.2% of Insight Capital (7707E)
March 03 2020 - 2:00AM
UK Regulatory
TIDMCTNA
RNS Number : 7707E
Catena Group PLC
03 March 2020
The information communicated within this announcement is deemed
to constitute inside information as stipulated under the Market
Abuse Regulations (EU) No. 596/2014. Upon the publication of this
announcement, this inside information is now considered to be in
the public domain.
3 March 2020
Catena Group PLC
("Catena" or the "Company")
Conditional agreement to acquire up to 30.2 per cent. of Insight
Capital Partners Ltd, an artificial intelligence company
Catena Group plc (AIM: CTNA), a UK based venture capital company
focused on acquiring or investing in companies operating in high
growth industries, is pleased to announce that it has entered into
a conditional investment agreement to acquire an initial 9.1 per
cent. interest (on a fully diluted basis) in the ordinary share
capital of Insight Capital Partners Limited ("Insight") for GBP1.5
million payable in cash (the "Investment"). The Company has also
secured an option to increase its holding to 30.2 per cent. of
Insight's fully diluted ordinary share capital, on the same terms
as the Investment.
About Insight
Insight is an artificial intelligence ("AI") company that
combines quantitative research, data engineering and machine
learning to deliver bespoke analytical tools to financial services
clients, enabling them to extract data from outdated platforms and
improve the accessibility and insight locked within.
Insight's founders, Steve Cracknell and Warren Pearson, bring
with them a wealth of success in delivering machine learning
solutions to the financial services sector. Both gained their early
experience as application developers and engineers at Goldman
Sachs, followed by roles with Thomson Reuters, the London Stock
Exchange and a Silicon Valley AI startup, before launching Insight
two years ago.
Based on unaudited statutory accounts for the year ended 31
March 2019, Insight (including its wholly-owned subsidiary, Insight
Capital Consulting Ltd) generated revenue of GBP0.7 million and a
loss before tax of GBP1.1 million. The consolidated net assets of
Insight at 31 March 2019 were GBP0.5 million. Insight has continued
to gain commercial traction, generating revenue of GBP1.8 million
and profit of GBP0.2 million for the nine months ended 31 December
2019 (source: Insight's unaudited management accounts).
Rationale for the Investment
This initial Investment is directly in line with Catena's
refocused strategy of investing in quality fast growing companies.
Machine learning is widely recognised as having the potential to
fundamentally benefit performance and profitability in many, if not
all, industries. Catena's investment today is a first step toward a
broader strategy to capitalise on growth opportunities in AI and
machine learning.
Insight has already built credibility by delivering business
transformational solutions to top-tier asset managers in Europe and
the United States. Catena's investment and growing partnership with
Insight will enable it to accelerate the development of its
proprietary technology and build out its capabilities to serve a
wider range of clients with a broader set of solutions.
Option
On completion of the Investment, Catena will also have a
six-month option to acquire further ordinary shares in the capital
of Insight at the same subscription price as the initial investment
announced today. If this option is exercised in full, Catena would
increase its shareholding to 30.2 per cent. of Insight's ordinary
share capital (on a fully diluted basis) for a further GBP5.0
million in cash.
Financial considerations
The Investment is based on a pre-money valuation of GBP15.0
million and is conditional upon certain standard commercial terms,
including receipt of funds.
Matthew Farnum-Schneider, CEO of Catena, commented:
"We are delighted to have secured this investment in Insight.
Machine learning is set to revolutionise the asset management and
financial services industries and we believe that Insight is
ideally placed to capitalise on the exponential growth in the
sector. Insight's demonstrated performance of delivering near-term
tangible commercial benefits via its machine learning solutions has
already generated profitable growth. Today's investment should
accelerate Insight's reach and is the first step in our growing
alliance. We look forward to working with Steve Cracknell and his
team in realising Insight's enormous potential."
Steve Cracknell, CEO and founder of Insight commented:
" The tools we are developing are designed to leverage the data
analysis and insight advantages offered by machine learning, whilst
giving users the flexibility to overlay their own expertise. This
combined with the speed and scale that cloud computing and DevOps
offers, will make the immense power of machine learning and AI more
readily accessible to investment professionals and the broader
financial services sector. Our partnership with Catena will allow
us to accelerate the development of these tools and expand the
reach of our business."
* ENDS *
This announcement has been released by Matthew Farnum-Schneider,
Chief Executive, on behalf of the Group.
For further information, please visit catenagroup.co.uk or
contact:
Catena Group PLC
Matthew Farnum-Schneider +44 (0)20 3743 2543
Cantor Fitzgerald Europe (Nomad and Broker)
David Foreman/Michael Boot/Adam Dawes +44 (0)20 7894 7000
St Brides (Financial PR)
Catherine Leftley/Beth Melluish +44 (0)20 7236 1177
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END
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