Lukies out as Monitise pulls back from sell off

Lukies out as Monitise pulls back from sell off

Monitise founder and co-CEO Alastair Lukies is to step down from the board of the UK mobile banking group, as the business strives to go it alone as an independent company following a failed search for a third-party suitor.

Loss-making Monitise announced that it was putting itself in the shop window in January as the business reported widening losses and a drop in revenue.

Last month, the company reported that it had "positive discussions" with a number of interested parties, but in the latest twist in the saga the board has concluded that "the best way of maximising long-term value for all stakeholders is to continue transforming and streamlining the business as an independent company".

Shares in the vendor slipped 18% in early morning trading as the market digested the announcement, which sees Elizabeth Buse become sole CEO as Alastair Lukies is demoted from the board to a new role as 'founder and strategic adviser'.

Stephen Shurrock, CEO of consumer at Telefónica is appointed non-executive director representing strategic shareholders Telefónica and Santander.

Monitise reported an Ebidta loss of £30.8 million for the six months to 31 December, from £10.2 million in the comparable period last year. Revenue also fell 8.8% to £42.4 million as the company adjusts to a new business model based on recurring revenues.

Despite the red ink, Monitise has reiterated its target of being Ebitda profitable in FY 2016.

Monitise chairman Peter Ayliffe says: "I am extremely confident that the business is at a point in its development where the prospects for delivering long-term value are excellent."

He says that none of the indicative and non-binding proposals the company received fully recognised the longer-term value of the business. "The feedback from third parties re-affirms that we have a uniquely strong technology platform, a talented and highly respected management team, and a deep well of support among staff, partners and clients for what we are seeking to achieve."

The decision to go it alone is supported by Santander, which invested £33 million in November to acquire a five percent stake in Monitise.

Senior EVP and corporate director of innovation at Banco Santander, José María Fuster, says: “Santander believes that Monitise is uniquely well positioned as an independent player in the fast-growing digital money space. We have already through our partnership with Monitise developed some market-leading propositions for our customers and intend to continue doing so through what we expect to be a long and mutually beneficial collaboration.”

Comments: (2)

A Finextra member
A Finextra member 25 March, 2015, 15:53Be the first to give this comment the thumbs up 0 likes

I think this is the best thing that could have happened at Monitise. Lukes was in way over his head, trying to run it like a start up but wanting heavy duty investments from Visa, MasterCard et al. I have never been impressed with his "jam tomorrow" approach. I am sure we won't have seen the last of him, I hear there are lots of vacancies at Visa Europe.. What should have been a breakthrough technology has instead become the Betamax of the payments world.

I am sure Buse will prepare for the sale (back) to Visa Inc at a much reduced rate. And to think Lukes was last seen presenting at a Visa event just three years ago as a model CEO who had developed and turned around this industry. He has some serious 'supporters' at the time. But alas their new CEO soon waved good-bye to them.

Paul Love
Paul Love - Konsentus - Nottingham 26 March, 2015, 09:30Be the first to give this comment the thumbs up 0 likes

Monitise - A great name, but poor execution

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