Monitise falls following successful placing

published 4 December 2012

Monitise is down following its successful placing of the first tranche of shares in a 100m pound fundraising.

The total fundraising entails placing 333.3m shares at 30p in two tranches. The first tranche of 114m shares in a 'firm' placing with institutions will now enter the market on December 10th. The second tranche of 219.2m shares, in a 'conditional' placing with institutions, is expected to hit the trading floor on December 27th.

This placing equates to a 22.5% dilution of the current shareholder base of 1.1bn shares.

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Monitise, which provides the software for payment systems on mobile phones, will use the proceeds to fund new Mobile Money products for financial institutions and payments companies.

The company, with a market cap of about £340m, has yet to make a profit but house broker Seymour Pierce has a 'Buy' recommendation on it with a price target of 60p.

The broker commented: "Management believes the proceeds from the placings are expected to drive revenue expectations 'substantially higher' over the next 2-5 years and lead to only a slight delay in near-term profitability. Management reiterated its full year 2013 revenue guidance of $110m but has not provided any guidance for full year 2014."

At 15:50 the shares were down 3.5p or 9.85% at 29.75p.