Mercom Capital Plc Investment in Mobile Wireless and Satellite SAPI (7508M)
October 17 2016 - 11:53AM
UK Regulatory
TIDMMCC
RNS Number : 7508M
Mercom Capital Plc
17 October 2016
17 October 2016
Mercom Capital Plc
("the Company")
Investment in Mobile Wireless and Satellite SAPI
The Directors of the Company are pleased to announce that the
Company has agreed to invest GBP600,000 for a 16% interest in
Mobile Wireless and Satellite SAPI ("MOWISAT"), a newly established
Mexican company in the financial technology and payments industry.
MOWISAT intends to be the first provider of fintech solutions for
unbanked communities in Mexico which it plans to deliver as a
mobile virtual network operator ("MVNO"). To that end, MOWISAT has
executed a Letter of Intent to offer such services on an exclusive
basis through a nationwide commercial and retail distribution
network with over 25,000 outlets with a reach of approximately 40
million people in rural areas as well as the outskirts of every
major city in Mexico. MOWISAT plans to deploy its financial
services offering as described below in the first quarter of 2017.
In due course, the Company will launch in similar rural markets in
other countries of Latin America.
The Mexican cellular market has around 109 million subscribers,
around 84% of which are on prepaid packages. Mobile penetration is
approaching 89% with average ARPU across the market of
approximately US$12. The new Mexican Telecommunications Regulation
(Ley Federal de Telecomunicaciones y Radiodifusión), which became
effective in the second quarter of 2014, opened up a variety of
business opportunities for MVNOs which currently have an aggregate
market share of approximately 0.8%.
MOWISAT's technology will enable the company to provide a highly
differentiated "one stop shop" financial services offering covering
micro lending, debit/credit cards, payment systems, affordable
remittances, e-commerce and payment platforms (e-wallet). The
deployment of the company's services will be in collaboration with
one of Mexico's leading banks which currently offers online banking
services and has the resources to handle over 50 million online
bank accounts. In addition, the company will provide access to its
platforms to other complementary fintech solutions.
Founder MOWISAT shareholder Guillermo Zambrano Martinez, of
Lottus Capital Partners (a private equity firm specializing in
growth oriented companies) and his team have initiated a series of
collaborations to further enhance and differentiate the business
model of MOWISAT.
The Universidad de Guadalajara has recognized this unique
offering and will be promoting MOWISAT's services to all its
students who number approximately 16,000.
MOWISAT's experienced management team includes Davide Ferri as
COO. Mr Ferri has been in the telecoms industry for over 16 years
and for more than a decade has focused on Mexico as a founding
partner of Aircrowd SA de CV. Aircrowd is a provider of development
platforms and services for MVNOs and MNOs. Its services to its
telecoms clients include bulk SMS platforms currently handling over
10 million messages per month. Mr. Ferri will be fully focused on
MOWISAT's operations. The relationships that MOWISAT's senior
management has historically built in the market place will be an
added asset for the company.
Mercom's CEO John Zorbas commented: "This investment in MOWISAT
is the first we have made since shareholders approved the change to
our investing policy to include financial services and financial
services technology. We believe the market in Mexico will be very
receptive to the introduction of fintech solutions over an MVNO
model. MOWISAT management understands both the technical needs of
the financial service industry and its interface with the MVNO
model. Considering the technological advances and the rapid growth
of cellular connectivity that has occurred in recent years, we
believe this is a great opportunity to shape and lead an
industry."
"In due course, the Board anticipates making further investments
in the financial services and financial technology sectors and to
that end will look to raise additional equity from investors to
supplement the Company's cash resources following the investment in
MOWISAT. For this reason, on 10 October the Directors convened a
General Meeting to be held on 27 October to seek new authorities to
allot shares for general purposes and on a non pre-emptive
basis."
This announcement contains inside information for the purposes
of Article 7 of the Market Abuse Regulation (EU) No 596/2014.
For further information, please contact:
Mercom Capital Plc
John Zorbas 001 416 504 3978
Northland Capital Partners
Limited
Nominated Adviser and
Broker
Edward Hutton / Matthew
Johnson +44 (0) 20 3861 6625
Beaufort Securities
Limited
Joint Broker
Elliot Hance +44 (0) 20 7382 8300
This information is provided by RNS
The company news service from the London Stock Exchange
END
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