Novatti Offloads Emersion Business for $500,000 to Focus on Core Payments
Novatti Group has offloaded its Emersion business to CGP Equity for $500,000, marking a strategic pivot to concentrate on its core payments infrastructure in Australia and New Zealand.
- Sale of Emersion business for $500,000 to CGP Equity
- Divestment follows strategic review highlighting misalignment with long-term goals
- US subsidiary excluded from sale and to be wound up
- Novatti refocuses on scaling core payments infrastructure in AU/NZ
- Ongoing strategic review of other business units continues
Strategic Streamlining
Novatti Group Limited (ASX, NOV), a prominent player in the Australian fintech payments sector, has announced the sale of its Emersion business to CGP Equity for $500,000. This move is part of a broader strategic review aimed at refining Novatti’s portfolio to better align with its long-term financial objectives.
The Emersion business, operated through its wholly owned subsidiary Emersion Systems Pty Ltd, was acquired and integrated into Novatti’s operations starting in 2021. However, the company’s recent assessment concluded that Emersion no longer fits within Novatti’s evolving strategic direction and is unlikely to contribute meaningfully to its future growth ambitions.
Refocusing on Core Strengths
CEO Mark Healy emphasized that the divestment allows Novatti to concentrate its resources and management attention on scaling its core payments infrastructure across Australia and New Zealand. This core business remains the company’s most attractive growth priority, promising more sustainable returns for shareholders.
CGP Equity, with its strong background in managed service providers and telecommunications, is seen as well-positioned to guide Emersion through its next growth phase. The sale agreement includes customary provisions such as staff retention bonuses and maintaining a minimum net cash balance to ensure operational continuity.
Exclusions and Ongoing Review
Notably, the US-based subsidiary of Emersion was excluded from the sale and is slated for winding up. This indicates a further streamlining of Novatti’s international footprint, focusing more tightly on its core regional markets.
Novatti’s strategic review is ongoing, with the company continuing to evaluate other business units and investments. The goal remains to strengthen its core payments business and pursue long-term financial targets amid a rapidly evolving fintech landscape.
Investors and market watchers will be keen to see how Novatti’s renewed focus translates into operational performance and shareholder value in the coming quarters.
Bottom Line?
Novatti’s Emersion sale signals a sharper focus on core payments growth, but the strategic review’s next moves will be critical.
Questions in the middle?
- What further divestments or acquisitions might Novatti pursue following this sale?
- How will Novatti’s core payments infrastructure scale amid increasing fintech competition?
- What impact will the winding up of the US subsidiary have on Novatti’s international ambitions?
