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- Payment security company iSignthis (ISX) has bumped up its shareholding in NSX (NSX) today
- The company bought up $1.5 million worth of NSX shares at 9.1 cents each through a share placement
- NSX is the operator of the National Stock Exchange of Australia
- Of course, it’s no surprise iSignthis is getting cosier with the alternative stock exchange given its bad blood with the ASX
- iSignthis has been in a legal scuffle with the ASX over its ongoing share suspension
- The company said today by working with NSX, it can help make a “more credible” alternative to listing on the ASX
- Shares in iSignthis last traded for $1.07 each on October 2, 2019
Embattled payment security company iSignthis (ISX) has bumped up its shareholding in NSX (NSX) today.
The two companies have been working closely since earlier this year, when iSignthis nabbed a 12.96 per cent interest in the operator of the National Stock Exchange of Australia (NSXA).
Since then, the companies formed the ClearPay joint venture to rival the ASX’s Austraclear Service. In March, iSignthis CEO John Karantzis was appointed CEO and Managing Director of NSX.
Today, ISX took part in an NSX share placement, buying up roughly 16.5 million NSX shares at 9.1 cents a pop. The buy-up cost iSignthis $1.5 million.
Of course, it’s no wonder iSignthis is getting cosy with a different stock exchange given its bad blood with the ASX.
The ASX v ISX scuffle
In early October 2019, iSignthis shares were suspended by the ASX based on concerns over recent share price movements. ASX sent through several rounds of questions over the next two months, but ISX’s answers were not satisfactory.
When iSignthis shares were still locked up tight by December, the company took the battle to Federal Court grounds.
iSignthis recently lost a round of the court battles when an injunction application over an ASX Statement of Reasons was denied. As a result, however, the ASX was able to publically reveal why it was keeping iSignthis shares suspended.
It seems key concerns for the share market operator revolve around ASX suspicions of dodgy contracts and illegitimate performance shares.
The latest correspondence between the two entities shows a change in tone from respectful requests to scathing accusations. Both companies are accusing the other of acting dishonestly.
However, iSignthis made a point this morning to suggest its business relationship with the NSX is part of a long-term strategy crafted long before the ASX woes begun.
Long-term goals
iSignthis said its strategy since 2016 has been to deliver an identity, payments, and transactional banking platform.
The company said applications with the likes of the Reserve Bank of Australia, the Australian Prudential Regulatory Authority (APRA), and the Australian Securities and Investment Commission (ASIC) were in direct support of this strategy.
As such, the company seems to be suggesting it was expecting some ASX-related headwinds.
“This strategic initiative put us squarely in competition with the effective monopolist incumbent, the ASX,” the company wrote today.
It would seem to shareholders that iSignthis is making the indirect assertion that its scuffle with the ASX is based on the competitive threat ISX’s business poses.
Regardless, the company touted the benefits of its relationship with the NSX.
Future opportunities
iSignthis said the NSX relationship will help the company build up its Digital Ledger Technology (DLT) and integrate it with a Delivery versus Payment (DvP) platform.
According to ISX, this tech will make the NSXA a more credible alternative to listing on the ASX for issuers. Further, the DLT could enhance the company’s own operations and could be licensed to other market operators.
Whether or not shareholders agree with ISX’s sentiments is not certain, however, given the company’s shares remain suspended. Shares in ISX last traded for $1.07 each on October 2, 2019.
