TechFinancials has issued a payment of $4.5 million to the shareholders of its Far East partners from OptionFortune. The technology provider has entered into a partnership agreement with the company several years ago, leading to a successful long-term business relationship between the firms.
The company announced in April that it would be issuing a total of 12,406,352 shares at a price of £0.27 ($0.37) per share to the OptionFortune Shareholders. The closing price of the Ordinary Shares traded on the London Stock Exchange on the 10th of May 2018 was £0.165 ($0.22) per share.
Shares traded lower today, dropping about 9 percent in light of the announcement. TechFinancials is required to issue shares or make cash payments to its partners under the joint venture agreement. The payment is contingent on the financial results of the DragonFinancials business which the companies are sharing.
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A Material Contribution from the Joint Venture Partnership
During the past year, DragonFinancials achieved financial results which required TechFinancials to pay $4.5 million. Earnings from the Asia Pac subsidiary of TechFinancials have been instrumental for the company in recent years.
Out of the total 12,406,352 ordinary shares, 9,304,764 shares were issued to Shen Chaohui, 1,860,953 shares issued to Ma Liangliang and 1,240,635 shares issued to Ke Endian which rank pari passu with the Company’s existing issued Ordinary Shares to be admitted to trading on the AIM Market of the London Stock Exchange.
The new shares will be admitted for trading on the 17th of May 2018. After the admission, the issued share capital of the Company will comprise 84,980,979 Ordinary Shares with voting rights attached (one vote per share).