Investment firm Finsbury is taking MyBucks, a FinTech company owned by JSE-listed Afristrat, to court in the UK.
The battle is related to the failed acquisition of MyBucks Zambia by Finsbury from the Frankfurt-listed FinTech and banking group.
Finsbury wanted to buy 45% equity in MyBucks Zambia under a Put and Call Option Agreement between MyBucks and Finsbury. A put and call option agreement is defined as when you buy an options contract; it grants you the right, but not the obligation to buy or sell an underlying asset at a set price on or before a specific date. A call option gives the holder the right to buy a stock, and a put option gives the holder the right to sell a stock.
Finsbury claimed the Frankfurt-listed firm was obliged to extend a loan for the purchase of the 45%, being the subject of the Option.
“As a result of the disagreement, Finsbury has approached the Courts of England to claim performance by MyBucks,” Afristrat informed investors on the JSE.
“Furthermore, Finsbury claims damages on the failure by MyBucks to honour the extension of the $12million (R174 million) loan.”
Afristrat said MyBucks’ board and legal counsel believe the claim is without merit and “will be vigorously defended in the Courts of England”.
“The litigation may potentially have an impact on the timing of receiving Reserve Bank approval of the additional disposal.”
Afristrat also revealed that MyBucks has agreed with Xtenda to dispose of its remaining 45% interest in MyBucks Zambia for $2.7 million (R39 million.) This possible transaction is classified as additional disposal.
The transaction remains subject to approval from the Bank of Zambia.
MyBucks also said the Bank of Mozambique approved the disposal of its stake in MyBucks Banking Corporation (MBC) registered in Mozambique.
The company is disposing of its 96.5% stake in MBC to Xtenda Financial Holdings Limited.
“The proceeds of approximately EUR 11.3 million (R199 million) will be fully applied to the settlement of third parties,” said MyBucks.
Global FinTech Player With South Africa Roots
The FinTech firm experienced exponential growth since its inception in 2011 and today has operations in nine African and two European countries. In June 2016, MyBucks became the first African focused FinTech company to be listed in Germany and started trading on the Frankfurt Stock Exchange.
The African FinTech firm was founded by South African-born Dave van Niekerk, through its brands GetBucks, GetBanked and GetSure offers unsecured consumer loans, banking solutions as well as insurance products to customers.