Finablr (LON:FIN), a global platform for payments and foreign exchange solutions that was planning to secure $200 million (last year) in order to prepare to list on the London Stock Exchange, has reportedly uncovered a “hidden” debt pile of £1.3 billion ($1.625 billion).
Finablr’s company shares were suspended in March 2020 due to “material uncertainty” regarding its ability to maintain operations. This move was followed by the discovery of $100 million worth of cheques which had not been previously disclosed.
Earlier this year, Promoth Manghat resigned from his position as CEO at Finablr, and was replaced by Bhairav Trivedi.
Finablr has reportedly worked with forensic investigators from Houlihan Lokey and Kroll, who helped the firm look through its transaction records in order to determine its actual levels of indebtedness.
Finablr’s management stated:
“The results of this exercise currently indicate that the total net indebtedness of the Finablr Group may be approximately $1,300 million (excluding any liabilities of the Travelex business). This is materially above the last reported figure for the Group’s indebtedness position as at 30 June 2019 and the levels of indebtedness previously disclosed to the Board. The Board cannot exclude the possibility that some of the proceeds of these borrowings may have been used for purposes outside of the Finablr Group.”
These debts may not include the outstanding liabilities of Travelex, a foreign exchange firm that put itself up for sale in April 2020.
Finablr further noted:
“The exercise to verify the Group’s indebtedness position is ongoing. The Company and Houlihan Lokey intend to engage further with the Group’s creditors to explore the options that may be available to the Group and its creditors.”
The firm had previously reported a total debt of $334.1 million on June 30, 2019, when it released its financial results for the period in August 2019.
Finablr is majority-owned and co-chaired by BR Shetty, an Indian businessman, who’s the founder and (allegedly) fraudulent acquirer of several firms headquartered in the United Arab Emirates.
In May 2019, Finablr was floated on the London Stock Exchange. The company was valued at $1.3 billion at the time.
Finablr had a market capitalization of £77 million (appr. $96 million) when it was suspended from trading in March 2020. At its peak, the firm had a £1.5 billion market cap (in December 2019).