Cornerstone FS PLC (AIM:CSFS), the corporate-focused payments group, is to acquire forex broker Capital Currencies for up to £3mln.
Capital Currencies has a similar focus on primarily UK corporates and especially larger SMEs, said Cornerstone, with over 90% of revenue generated by clients it services directly.
The business, which was founded in 2004, made a profit of £340,000 on turnover of approximately £600,000 in the year to end January 2021. Capital Currencies founder Craig Strong will stay with the business once the acquisition completes.
Cornerstone will undertake a placing to raise a minimum of £0.85mln at a price of 26.5p per share to help pay for the deal, which comprises £586,000 upfront with the rest to be met through shares and convertible loan notes in an earn-out deal.
Julian Wheatland, Cornerstone’s chief executive, added: “Capital Currencies is an excellent strategic fit thanks to its focus on providing high-level currency exchange and international payments services directly to larger UK-based SMEs.
“As a result, this acquisition is expected to accelerate our growth, being earnings accretive from the current year, and expand our presence in our core target market.”