Why the Fatfish (ASX:FFG) share price is rocketing 38% higher today

This small cap is having a very strong finish to the week…

| More on:
Iluka share price 3D white rocket and black arrows pointing upwards

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Fatfish Group Ltd (ASX: FFG) share price has returned from its week-long suspension with a bang.

In early trade, the technology venture company's shares were up as much as 38% to 10.5 cents.

The Fatfish share price has since eased back but remains up 18.5% to 9 cents at the time of writing.

Why is the Fatfish share price zooming higher?

The Fatfish share price is zooming higher today after the company announced an agreement to acquire BNPL Next for a consideration of A$4.14 million.

The release explains that BNPL Next is a holding company that aims to provide various corporate and consumer financial services in the South East Asia market.

The company also owns a 60% interest in Circopay, which is an Earned Wage Access (EWA) solutions provider allowing employees early access to earned wages. It has raised just over A$1million in funding and secured credit lines of A$5 million to facilitate its EWA services.

Management notes that the Circopay business is in an early growth phase and therefore it is not able to quantify the revenue income for Fatfish as a proposed 60% shareholder. If and when the revenue impact of the Circopay business can be responsibly determined, Fatfish will make further disclosure to the market at that time.

Why acquire BNPL Next?

According to the release, management believes the acquisition of BNPL Next fits into its strategy to invest in and build on emerging global technology trends in digital financing needs. This is especially the case given its existing plan to roll out buy now pay later (BNPL) services across Southeast Asia.

In addition to this, it believes the EWA market is an attractive place to be. This is due to its "win-win nature for both employees and employers."

Another positive it sees from the deal is the first-mover advantage it gives the company. It notes that as one of the pioneer EWA service providers in Southeast Asia (where a large proportion of the working population have comparatively lower income as well as limited access to financial services), Circopay is poised to capitalise on its first-mover advantage within the region.

Despite today's strong gain, the Fatfish is down a whopping 79% from its 52-week high.

James Mickleboro does not own any shares mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Share Gainers

Young girl drinking milk showing off muscles.
Share Gainers

Here are the top 10 ASX 200 shares today

It was a great end to the trading week for ASX investors today.

Read more »

A man sits thoughtfully on the couch with a laptop on his lap.
Share Gainers

3 ASX 200 stocks smashing the benchmark this week

These three ASX 200 stocks are leading the charge this week. Here’s how.

Read more »

A young woman holding her phone smiles broadly and looks excited, after receiving good news.
Share Gainers

Why A2 Milk, EOS, GQG, and Mineral Resources shares are racing higher today

These shares are ending the week strongly. But why?

Read more »

A man wearing a red jacket and mountain hiking clothes stands at the top of a mountain peak and looks out over countless mountain ranges.
Share Gainers

Here are the top 10 ASX 200 shares today

It was another disappointing day for ASX investors this Thursday.

Read more »

two men smiling with a laptop in front of them, symbolising a rising share price.
Share Gainers

Why Pinnacle, PWR, Race Oncology, and Vulcan shares are flying today

These shares are having a good session on Thursday. But why?

Read more »

A beautiful woman holds up one finger with one hand and has her hand on her waist with the other as she smiles widely as though she is very pleased about something.
Share Gainers

Why Boss Energy, Emeco, Mineral Resources, and Plenti shares are pushing higher today

These shares are having a good time on hump day. But why?

Read more »

Three small children reach up to hold a toy rocket high above their heads in a green field with a blue sky above them.
Share Gainers

3 ASX 300 shares going gangbusters on Wednesday

Investors are bidding up these three ASX 300 shares today. But why?

Read more »

Man raising both his arms in the air with a piggy bank on his lap, symbolising a record high.
Share Gainers

Here are the top 10 ASX 200 shares today

It was a huge Tuesday for ASX shares, with the index resetting its record high.

Read more »