Banking services provider Goldfields Money Limited (ASX: GMY) and financial technology firm Stargroup Limited (ASX: STL) have agreed to double the value of their ATM Cash Convenience Agreement to $30 million for a three year term.
Highlights
• Goldfields Money and Stargroup agree to double the value of their existing Cash Convenience Agreement to $30 million.
• New agreement based on strong demand for product and boost in number of ATM s under Stargroup management following Stargroup’s acquisition of Indue Limited assets
• Goldfields Money to continue to populate a network of pre-agreed Stargroup managed ATMs with its excess cash reserves
• Three-year agreement between strategic partners with option to extend
• No additional credit risk for Goldfields Money and returns uncorrelated to credit cycle
The revised agreement builds on the success of collaboration between Goldfields Money, an Authorised Deposit-taking Institution, and leading ATM and financial technology company Stargroup.
Goldfields Money will populate part of the Stargroup network of ATMs with its excess cash reserves as part of a well-established growth and diversification strategy.
Stargroup recently boosted the number of ATMs it has under management by 2,414 with the acquisition of Indue Limited’s ATM switching, settlement, processing, telecommunications and reseller business.
Goldfields Money Chief Executive Officer Simon Lyons said: “We welcome this opportunity to increase our existing arrangements with Stargroup, which has proved highly successful in the first nine months of operation and provides us with an additional low risk revenue stream that is uncorrelated to the credit cycle.”
Stargroup Chief Executive Officer Todd Zani said: “We are pleased with the increase in our arrangement to $30 million based on increasing demand in our system following our acquisition of Indue’s ATM assets. Our strategy is to become a leading player in both the ‘cash out’ and ‘cash in’ cycle in Australia and we are working closely with Goldfield Money as part of the strategy.”
Under the initial agreement announced in September 2016, Stargroup lowered cash costs, provided Goldfields Money with ATMs to service customers in remote locations an installed its “bank in a box” Recycler ATM in Goldfields Money branches. The two companies are committed to working together on additional financial products and further strategic alliances that benefits their mutual customer base.
STL Price at posting:
2.6¢ Sentiment: Hold Disclosure: Held
