The Board of Vela (AIM: VELA) is pleased to announce its first investment since the restructuring completed on 26 August 2020. Vela has invested £250,000 in Mode Global Holdings plc (“Mode”), as part of an IPO funding round by Mode which has raised £7,500,000 (the “Fundraise”).
Further information on Mode
Mode is a UK-based fintech group, building a modern financial services business to support an increasingly digitised economy and financial system, combining banking, payments, investment, customer loyalty and digital assets. Its business today comprises:
· Mode app – a digital banking app that allows users to manage their traditional and digital assets all in one place.
· Bitcoin Jar – one of the highest-yielding and most flexible interest-generating accounts for Bitcoin in the market (accessible through the Mode app).
· Business payments (WeChat and Alipay) – payment processing services for UK and European businesses to tap into the Chinese market. Mode has secured key partnerships with Tencent (owner of WeChat) and Alipay.
· Business marketing services (WeChat) – marketing and social media services for UK and European businesses on one of China’s most popular communication apps.
Mode’s ordinary shares were today admitted to trading on the standard listing segment of the Official List of the UK Listing Authority and to trading on the London Stock Exchange’s main market for listed securities.
For the year ended 31 December 2019, Mode’s pro forma revenue was £2,000 and its pro forma loss before taxation was £3.15 million. Mode’s pro forma net assets as at 31 December 2019 were £8.87 million.
Further details on Mode are contained in their prospectus which is available on Mode’s website at www.modeplc.com/investors/ipo-documentation .
This investment has been made in line with the Company’s investing policy and the strategic emphasis of delivering demonstrable, short-term, value accretion for Vela’s shareholders. Specifically, Vela will henceforth be more focused on three key areas within the Company’s existing technology-focused investing policy and the broader disruptive technology space:
· Pre-IPO investments where Vela can play an active role in helping achieve the market listing and a consequential potentially material return on its investment, within an anticipated time horizon of six to twelve months;
· “Special Situations” within the UK public markets, where the deployment of Vela resources, funds and expertise can potentially deliver a material return to shareholders, also within a relatively short time horizon; and
· IPOs or other public fund-raising processes, where the connectivity and market position of the company, its investee companies and its key stakeholders provide the opportunity for Vela to participate in closely-held or ‘invitation only’ situations.
Additionally, other investments which are outside the above focus areas and in accordance with the Company’s existing investing policy, will continue to be considered by the Vela Board on a case-by-case basis.
Details of the Fundraise
Vela has invested £250,000 in Mode, from the Company’s existing cash resources. Vela has subscribed for 500,000 new ordinary shares of 1p pence each in Mode, at a price of 50p per share, valuing Mode at £40.3 million.
Following completion of this Fundraise, Vela will hold 500,000 ordinary shares in Mode, representing 0.62 per cent. of Mode’s enlarged share capital.
James Normand, Executive Director of Vela, commented :
“We believe Mode has an exciting future as a listed company. We are pleased to participate in this over-subscribed fundraise. The Board continues to assess a number of other investment opportunities with a view to growing the Company’s investment portfolio in the near future.”
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