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.
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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.
