Following sharp drops in its share price, Monitise is considering all options, including a possible sale.
The UK-headquartered mobile banking vendor, beloved of UK Prime Minister David Cameron, endured a miserable 2014, a year in which it transitioned to a subscription-based business model: it repeatedly missed its targets, posted larger than forecast losses and needed to tap shareholders for yet more funds, the last being in November 2014, when it raised £49m ($74m) by way of a placement. And now, its share price has dropped 80% from a high of £0.80 last February to £0.17.
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Monitise was singled out by Cameron in his keynote address at the Conservative Party conference two years ago as a model example of British entrepreneurship.
Monitise now expects to post an annual loss of between £40m and £50m; revenue for the current fiscal will be flat at between £90m and £100m against its forecast of "at least 25% growth" on its revenue for the year ended June 2014.
This followed news that its biggest customer, Visa Inc, was planning to sell its stake in Monitise. Other shareholders in the company include MasterCard and Santander.
Speculation will now turn to the identity of possible suitors for Monitise. Last August, Monitise agreed a partnership deal with IBM giving the former access to the latter’s customer base of corporate customers.As part of the deal, 200 Monitise employees, one-fifth of the total workforce transferred to IBM.
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