Shares of CAB Payments fell sharply by 20% following StoneX’s decision to pull out from acquiring the company.
- StoneX had initially made proposals to acquire CAB Payments in July, with offers of £1.15 and £1.45 per share.
- CAB Payments’ stock took a significant hit after achieving a public listing on the London Stock Exchange last year.
- While StoneX withdrew its interest, its restriction on new offers is limited to six months under specific conditions.
- Leadership changes in CAB Payments also occurred, with a new CEO, Neeraj Kapur, appointed this year.
Shares of CAB Payments experienced a dramatic fall, plunging by 20% during early trading. This severe decline followed the announcement from StoneX, a US-based payments company, that it would not pursue the acquisition of CAB Payments. The decision was confirmed shortly before the deadline set for a firm offer, affecting investor sentiment profoundly.
StoneX, valued at approximately $2.7 billion, had approached CAB Payments twice this year with non-binding acquisition offers. The initial proposal was made in July, with an offer price of £1.15 per share, which CAB rejected. StoneX returned with a revised offer of £1.45 per share in October, valuing the company at £368.5 million. These proposals indicated StoneX’s interest in expanding its financial services portfolio, although they ultimately decided against proceeding.
CAB Payments went public on the London Stock Exchange in July 2023, marking a hopeful period for the UK’s tech public markets. However, the company’s shares have suffered since then, dropping from their debut price of 310p to just 89.17p, falling short of StoneX’s valuation measure.
According to market regulations, StoneX is now prohibited from making any further offers to acquire CAB Payments for the next six months. Exceptions to this restriction could apply if CAB Payments’ board consents or if a third-party offer arises.
This period of financial turbulence coincides with significant changes in CAB Payments’ leadership. The former CEO, Bhairav Trivedi, resigned less than a year after the company’s IPO. Neeraj Kapur took over as CEO in June, amid the company’s strategic moves, including an expansion into the European market through regulatory approval from Dutch authorities.
The withdrawal of StoneX and resulting share drop highlight ongoing challenges for CAB Payments amid market and leadership shifts.
