LONDON - Molten Ventures Plc (LSE: GROW, Euronext (EPA:ENX) Dublin: GRW), a prominent European venture capital firm, has revised its expected proceeds from the exit of its investment in Freetrade, a commission-free investment platform. The company now anticipates earnings of £20.4 million from the sale, a decrease from the previously forecasted £22.7 million. Despite the adjustment, this figure represents a 17% increase over the £17 million holding value as of September 30, 2024, and a 1.5 times return on invested capital.
Freetrade has agreed to be acquired by IG Group (LSE: IGG), a FTSE 250 entity known for its online trading platforms and educational resources worldwide. Molten Ventures first backed Freetrade in its Series A round in 2019. The transaction is pending regulatory approval, with the proceeds expected to be received in mid-2025.
Following this deal, Molten Ventures' total realizations for the current financial year have surpassed £150 million, outperforming the initial guidance of £100 million. On average, these realizations have yielded a 2.5 times return on invested capital, underscoring the effectiveness of Molten Ventures' valuation methods and investment strategy.
In response to the successful exit, Molten Ventures plans to initiate a £5 million share repurchase program, aligning with its commitment to allocate at least 10% of realization proceeds to such buybacks. The company aims to balance new investment opportunities with shareholder returns while maintaining sufficient reserves.
Ben Wilkinson, CEO of Molten Ventures, stated that the transaction with Freetrade exemplifies the company's active portfolio management strategy and highlights its success in scaling leading digital businesses. The proceeds from this exit will facilitate the launch of the new share repurchase program, which is intended to address the current undervalued state of Molten's shares.
The information for this article is based on a press release statement from Molten Ventures.
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