Frontier Digital Ventures Ltd,a leading operator of online classified businesses in frontier and emerging markets, has announced it will exit its investment with online property portal IMCongo.
Key takeaways
- Agreement reached with IMCongo vendors FOR frontier to exit its investment
- IMCongo vendors have sold their Frontier shares and agreed to use the sale proceeds to repurchase Frontier’s shareholding in IMCongo
- IMCongo vendors acquired Frontier shares at A$0.50 per share through a share swap executed at frontier’s IPO
The decision to exit the investment was a result of FDV’s portfolio optimisation process and underperformance of IMCongo relative to the high-performance hurdles established across all Frontier’s investments.
In 2016, FDV invested US $175,000 and $332,500 Frontier shares via a share sale agreement to gain an initial 65.9 per cent ownership of IMCongo.
IMCongo recorded revenues of $A10,924 (100%) basis in 1H 2017, compared with total revenue across the whole Frontier portfolio of $A10,909,973 for the same period.
Under an agreement with Frontier, IMCongo vendors have sold their 332,500 Frontier shares for A$242,725 to new investors and will use the sale proceeds to repurchase Frontier’s shareholding in IMCongo. Frontier expects the transaction to conclude in September 2017. The proceeds will add to Frontier’s existing cash balance.
Frontier’s CEO and Founder, Shaun di Gregorio commented on the decision.
“The exit of IMCongo is an example of portfolio rationalisation and prudent capital allocation,” di Gregorio said. “Due to the overall success of the portfolio to date, our internal hurdle for investment is high. Frontier assesses the performance of each investment on a monthly basis and deliberately optimises our time and financial resources towards investments with the greatest monetisation potential.”
