Cornerstone FS Plc (AIM: CSFS) announced on Friday the decision to sell its non-core subsidiary Avila House, an electronic money institute, to Aspire Commerce (trading as MulootMoney.com) for £300,000.

Cornerstone Offloads Avila House to Aspire Commerce in Cash Deal

The two companies, Cornerstone and Aspire, have already entered a share purchase agreement, and the payment will be made in cash. In addition to the acquisition deal, Aspire agreed to license the Cornerstone platform for 12 months which will generate a minimum of £290,000 for the London-listed company.

The proceeds from the sale will go to strengthen Cornerstone’s cash reserves. The approval for the sale is now pending with the FCA, and the companies are expected to close the deal by Q1 2023.

“This is an excellent deal for Cornerstone and reflects the value of an e-money registration as well as our platform,” said the CEO of Cornerstone, James Hickman, who joined the company last August. “As we have said previously, we have experienced strong trading momentum throughout the year, and it is great to now be ending 2022 having secured an additional £600,000 for next year. We look forward to reporting on our further progress.”

Check out the recent London Summit session on "Future of Payments: The Revolution Will Not Be Wired."

Cornerstone's Strategic Offloading of Non-Core Asset Avila

Cornerstone acquired Avila in October 2020 to enter the electronic money institution. However, the parent company obtained Financial Conduct Authority’s approval as an Authorized Electronic Money Institution, thus supplanting the limited license of Avila.

The official press release detailed that Avila generated revenue of £197,996 in the financial year 2021, mostly from inter-Group related activities. It ended the year with a profit of £2,418.

With the two similar licenses in its pocket, the board of the London-listed company decided to sell Avila to Aspire, a provider of payment accounts and lending services and also non-competing with Cornerstone.

Earlier this year, Cornerstone acquired London-based Capital Currencies, a foreign exchange broker specializing in the provision of currency exchange and international payments . Furthermore, the company is expanding internationally and opened a Dubai office last year.