Cirralto Ltd (ASX:CRO) has received commitments to raise A$18 million through the issue of 200 million fully paid ordinary shares to institutional sophisticated and professional investors at an issue price of A$0.09 per share.
The strategic capital raise follows two other placements; one in August 2020 undertaken to recapitalise the company, resulting in a debt-free balance sheet, and the second, in November 2020, to support the company’s growth with various payment providers.
This most recent round signals a strong vote of confidence and welcome support from institutional shareholders with the company now well-positioned with a strong balance sheet, to drive growth through the adoption of its payments technology across multiple industry segments.
The company intends to use funds for an accelerated commercialisation plan for its products, potential synergistic acquisitions, commercialisation of pilot business payments solutions and for future working capital requirements.
“Enhance our growth trajectory”
Cirralto CEO and managing director Adrian Floate said: “After the transformative year in 2020 with the significant restructuring of the company’s balance sheet, we are now in a financially strong position with the added firepower to focus on aggressive growth and accretive acquisitions that deliver shareholder value.
“It is our ambition to utilise this capital to enhance our growth trajectory and allow us to attract the talent and customers to grow our footprint both domestically and internationally, whilst also having sufficient operational runway funding to support us through the next phase of the company’s development and maturity.
“The completion of this transformational capitalisation of the company was managed by Kaai Capital and was largely supported by institutional investors, validating the market acceptance and positioning of the company’s and Appstablishment’s Spenda and SYNK’D technology platforms.”
Kaai Capital acted as sole lead manager to the placement and will donate A$90,000 of the fees it will receive to Australian registered charitable deductible gift recipients.
MySpenda software release
Cirralto has also launched MySpenda, the user interface of the company’s Spenda digital payment stack which brings together all the distinct Spenda modules into one dashboard that increases user experience, speeds up onboarding and enables the company to fully engage the product's viral capabilities.
MySpenda revolutionises bill presentation, removing manual data entry of credit card information, bank account details or customer reference numbers.
The software ensures increased security with the MySpenda user remaining in control of their payment details and never needing to provide these details to the businesses they trade with.
MySpenda is also integrated with small business accounting systems such as Xero, MYOB and Quickbooks Online, and ERP systems such as Microsoft Dynamics and SAP B1.
Using the interface businesses can navigate between their company view, ‘My Company’, and that of their ‘Connected Suppliers’.
“Designed to improve payment security”
Floate said: “What we are doing is unique in the market. We are creating software that focuses on and improves the buyer/seller relationship regardless of where this relationship sits.
“Our software is truly universal in application to anyone who buys or sells goods.
“Whether that be a wholesaler or supplier who needs a solution to manage their accounts receivables, a retail owner who needs to keep track of what they owe and to who, or a consumer who wants a better experience engaging with their debtors, Spenda is the wheel that enables these transactions.
“Furthermore, MySpenda sits on a foundation that puts the user first, no matter who that user is, and provides software designed to improve payment security, speed up transactions and keep money flowing through the economy.”
BPSP/BPA testing underway
The company has also reported the positive results of phase 1 of ‘customer to supplier’ payments utilising its newly established BPSP and BPA the MasterCard Business Payment Aggregator (BPA) and the Visa Business Payment Solution Provider (BPSP) merchant services.
These initial tests have provided valuable insight and enabled the company to resolve issues and refine the user experience ahead of commercial launch.
Phase 2 testing has now commenced and will place further focus on proving the impact of Reconciliation and Reporting enhancements that have been developed.
This is expected to be completed by March 1, 2021, with the commercial release to be confirmed in the week beginning March 1, 2021.
Shares have jumped more than 26 per cent intra-day to A$0.145 and the company market cap sits at approximately A$197.6 million.