20th Jun 2018 10:12
LONDON (Alliance News) - Myanmar-language social media platform MySQUAR Ltd on Wednesday announced a fundraising after agreeing a deal to buy MyPay Myanmar Ltd for GBP2.0 million in cash and shares.
The company will acquire payments business MyPay Myanmar from MyPay Ltd to develop its smartphone payments systems, which are anticipated to provide "substantial" revenues going forward.
It will pay the half of the amount in cash with the other 50% through a share issue. MySQUAR intends to issue 72.5 million shares to MyPay. The stock was trading 18% lower on the day Wednesday at 1.24 pence per share.
In addition, the company said it had GBP619,000 in cash as at March 29, with GBP381,000 scheduled for payments.
In order to strengthen its financial resources, MySQUAR has also agreed to issue GBP2.2 million in bonds to Atlas Capital Markets Ltd in addition to 666,667 warrants awarded over 42.9 million shares with an exercise price of 1.86p.
"Having now deployed the capital raised from the first issue of convertible bonds to Atlas in providing the balance of funds for acquiring MPM and funding the working capital requirements of the company and its development programme, we have raised further capital to continue to invest in our Myanmar local language social media network and in particular our mobile payments application," said Chief Executive Eric Schaer.
MySQUAR has previously partnered with MyPay to integrate MyPay's services into the MySQUAR's MyCHAT product. MySQUAR has already paid USD750,000 of integration fees for the contract, which expires in mid-December 2020.
Meanwhile, MyPay Myanmar has applied to the Central Bank of Myanmar for a payments licence. The company expects a minimum capital requirement of not less than USD2.2 million to satisfy the grant of a payments licence.
MyPay Myanmar incurred a loss of USD253,421 during the 12 month period to the end of March.
"The acquisition of MyPay Myanmar enhances our drive to be the leading directly regulated mobile payments facility for remittances back into Myanmar," added Schaer.
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