EML Payments settles PFS Group acquisition liabilities

EML Payments Limited (ASX: $EML) has entered into an agreement to settle all outstanding deferred acquisition payments from the acquisition of Prepaid Financial Services Group (PFS Group) in 2020 for £15.0m (A$28.8m). This settlement represents a £7.9m (A$15.2m) or ~35% reduction to the total value of the Loan Note liability if paid at face value plus interest by the specified instalment dates. Additionally, all historical earnout arrangements are confirmed at zero.

EML Payments executive commentary on the settlement

The settlement of all outstanding actual or potential liabilities from EML's PFS Group acquisition structure is an important milestone in the delivery of the EML Group's strategic review. By reducing the Loan Note liability and negating all other potential liabilities arising from the PFS Group acquisition structure, inclusive of potential earnout disputes, EML will strengthen its balance sheet and further de-risk the business.

Summary of EML Payments' settlement of PFS Group acquisition liabilities

EML Payments Limited (ASX: $EML) has successfully reached an agreement to settle all outstanding deferred acquisition payments and historical earnout arrangements from the acquisition of Prepaid Financial Services Group (PFS Group) in 2020. The settlement amount of £15.0m (A$28.8m) represents a significant reduction to the total value of the Loan Note liability, providing a ~35% discount. This settlement concludes all outstanding matters between EML and the PFS vendors, strengthening EML's balance sheet and further de-risking the business. The settlement will be funded from EML's cash balance and is expected to be paid by 31 July 2024. This strategic move aligns with EML's commitment to fortify its corporate strategy and enhance shareholder value.