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GSTechnologies Ltd (LON: GST) share price rallied 11% after announcing that it was acquiring Angra Limited, a British foreign exchange and payment services firm.
Investors cheered the move, which will see GST pay £800,000 to acquire the FCA-regulated company once the financial services regulators approve the transaction.
GSTechnologies will also inherit a £100,000 loan from the seller for a nominal amount since Angra Limited is wholly owned and operated by its sole shareholder and director, Rodolfo Modesto Basilio.
Angra Limited, which operates as AngraFX, had shown interest in acquiring an API license to help it connect to the traditional banking systems and agent networks, which could unlock new revenue streams for the firm.
While AngraFX is not highly profitable, having generated a profit of £69,000 in the year ended 30 September 2020, the company had assets worth £1.7 million at the time, of which £0.47 million was in cash.
GSTechnologies noted that it would terminate its efforts to seek an API license from the FCA since AngraFX already has an API license if the transaction is approved.
Tone Goh, GSTechnologies Chairman, commented: “We are very pleased to have reached an agreement with Angra. The acquisition of Angra, based in London, is intended to accelerate the development of our blockchain-enabled neo banking business… The acquisition of Angra will provide an established base on which to build our planned UK business.”
The company noted that it would continue pursuing its fintech growth plans in collaboration with its Wise MPay.
GSTechnologies shares are trading off a significant support level from a technical perspective, and I would like to see them rally. However, the shares have been trading sideways since early September.
*This is not investment advice.
GSTechnologies share price.
GSTechnologies shares rose 11% to trade at 1.21p, rising from Monday’s closing price of 1.09p.
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