Fintel boss says £7.6mn cash surplus will support acquisitions

Fintel boss says £7.6mn cash surplus will support acquisitions
Matt Timmins, joint chief executive officer at Fintel

Fintel joint chief executive officer Matt Timmins said the firm’s cash surplus of £7.6mn will support future acquisitions.

Last month, Fintel reported a 2 per cent uptick in total revenue growth, delivering “solid financial performance” in the first half of the year. 

In the six months to June 30, Fintel, which rebranded from The SimplyBiz Group last year, reported total revenue growth of £32.2mn, up from £31.7mn in the same period last year.

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The group also reported that it had “significant financial resources” with £7.6mn cash, a change from the £15.5mn debt last year.

Speaking to FTAdviser, Timmins said there are two primary purposes for the cash that it has, which consists of £7.6mn cash and an undrawn £45mn revolving credit facility (RCF) as well. 

“That allows us to do two things,” he said. “One is to invest into the products and services within the business, so investing into the Defaqto fintech, investing into the creation of new modules and other technology within both SimplyBiz and Defaqto.

“[The second is] having a significant amount of financial reserves and happy shareholders as well to help support future acquisitions. So it's a combination of investment into the business and acquisitions to support the two key brands, SimplyBiz and Defaqto.”

Timmins explained that Fintel is “very active” and constantly looking at businesses that it thinks can either provide additions to its customer base, for example new customers coming in, or businesses that have technology or services that will be useful to intermediaries. 

“It's a constant ongoing programme,” he said. “We've got the £45mn RCF facility so we're able to make acquisitions with confidence, of varying different sizes, and we continue to investigate good businesses that we might want to buy.”

Types of acquisitions

The types of firm Fintel is looking at would fall into three key categories, Timmins explained.

The first would be companies that do something similar to SimplyBiz, such as providers of regulatory support and services to intermediaries. 

The second category would be firms or businesses that have technology used by intermediaries, such as fintech businesses.

“The third would be businesses that have a particular skill set in data and data application,” he said. 

“Two of those obviously are very sector focused and the first two - support services and fintech - we are concentrating our conversations on businesses within retail, financial services within the market we deal with.

“Then the data business doesn't have to be sector specific but it has to have skills that can be applied across retail financial services.”

Timmins explained that at any point, the firm could have up to half a dozen conversations on the go but that it depends on the month and the type of business.