China Rapid Finance Ltd – ADR (NYSE: XRF) is climbing early this morning, and for good reason. The comapny announced a strategic alternatives review, exciting investors who are pushing the stock up. Today, we’ll talk about:
- The strategic review;
- what we’re seeing from XRF stock as a result; and
- what we’ll be watching for ahead.
XRF Announces Strategic Review
As mentioned above, China Rapid Finance is having an incredibly strong start to the trading session this morning after announcing a strategic alternatives review. The announcement came by way of press release early this morning.
In the release, XRF said that it has commenced a comprehensive review of strategic alternatives with the goal of maximizing shareholder value. The company said that the review will include a look at potential mergers or acquisitions as well as other transactions surrounding tis assets.
Also, the company said that it is currently engaged in formal discussions with several parties that have experessed interest in a potential transaction. Of course, there can be no assurance that any transaction will take place.
In a statement, Zane Wang, Founder and Co-CEO at XRF, had the following to offer:
The current regulatory environment for P2P lending platforms is creating substantial challenges, both for XRF and the industry as a whole. Many industry participants are considering partnerships, mergers, and other alternatives to bolster their businesses and ensure their long-term viability. We too are engaged in formal discussions that we believe can result in a strengthening of our competitive position.
What We’re Seeing From The Stock
One of the first lessons that we learn when we start to dig into the market is that the news leads to moves. When it comes to China Rapid Finance, the news proved to be positive.
After all, investors are hoping for a merger or acquisition as either one has the potential to yield strong returns of value. So, it’s not surprising to see that excited investors are pushing the stock up in the market this morning.
As is just about always the case, our partners at Trade Ideas were the first to alert us to the gains. Currently (10:32), XRF is trading at $0.43 per share after a gain of $0.13 per share or 41.13% thus far today.
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What We’ll Be Watching For Ahead
Moving forward, the CNA Finance team will continue to keep a close eye on XRF. In particular, we’re interested in following the strategic review to see if a transaction does take place. Nonetheless, we’ll keep a close eye on the story and bring the news to you as it breaks!
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