eTranzact International Plc has revealed plans to raise N7bn additional equity by increasing its authorised share capital.
The company, in a notice to shareholders, said the decision to raise additional capital became imperative, considering the need to expand its operations, deepen its market share and to remain competitive in the financial technology industry.
It said a capital raise proposal of N7bn was considered during the meeting of the board of directors and the authorised share capital of the company needed to be increased to accommodate the proposed capital raise.
The directors proposed the increase of the authorised share capital of the company from N2.1bn (divided into 4.2 billion ordinary shares of 50 kobo each) to N9.1bn (divided into 18.2 billion ordinary shares of 50 kobo each).
According to the notice, the share increase will be done through the creation of an additional 14 billion ordinary shares of 50 kobo each.
It said such new shares would rank pari passu in all respects with the existing ordinary shares of the company.
The notice read in part, “The financial technology industry has witnessed a rapid development within the last three years. This is in line with developments in the electronic payment system within the banking industry and the initiative of the Central Bank of Nigeria and the Federal Government to promote financial inclusion as part of the general macroeconomic framework.
“This rapid development in the electronic payment system has led to the emergence of many key players and stiffer competition with the industry. The financial, technological, workforce and corporate governance requirements have also changed to an unprecedented level as a result of key reforms within the sector.”
The company added that the board of directors deemed it important to increase the funding of the business through the injection of additional equity in a bid to remain competitive and also to ensure the sustainability of the business.
It stated that the funding would be used to upgrade and enhance the company’s technology infrastructure and network security systems and also to improve on its service delivery among other lawful purposes.
It said, “The company will also invest in its agent network expansion programme, human resources and employee development as this will help to ensure that it retains the best skill set available, achieve a fast response rate, reduce downtime, and expand its service offerings and market reach.
“The management and board of directors have carefully reviewed these developments in the electronic payment system. ln particular, the need for a state-of-the-art infrastructure and enhanced network security systems were identified as critical needs for the company.”