The OneVue Holdings Ltd (ASX: OVH) share price is one of the worst performers on the All Ordinaries on Monday.
In early afternoon trade the fintech company's shares are down over 8% to a 52-week low of 32.5 cents.
Why is the OneVue share price crashing lower today?
As well as coming under pressure from the broad market selloff, investors have been selling OneVue's shares after it provided an update on its Sargon Capital receivable.
Sargon Capital owes OneVue $31 million following the acquisition of its Trustee Services Business in June 2019.
It had previously deferred the payment of this amount until May 2020. However, at the end of last month Sargon Capital had McGrathNicol appointed as a receiver.
Unfortunately for OneVue, it has been reported that this is a holding company with no operating assets.
Today OneVue provided an update on the impact that this receivership is expected to have on its business.
OneVue Managing Director Connie Mckeage said: "It is important to emphasise that the OneVue business and its commitments to clients and growth is in no way dependent on the outcome of the Sargon receivable."
"The business is appropriately funded and has the balance sheet strength, cash generating capabilities, cash on hand and debt facilities to support the growth and operating requirements of the business. All outstanding amounts for acquisitions were fully extinguished in January 2020 including the final payment to KPMG for the acquisition of their superannuation administration business," she added.
Pleasingly, management still intends to initiate its recently announced share buy-back program. However, its dividend remains subject to the final principal repayment of the outstanding amount of $31 million.
OneVue Chair Ron Dewhurst said: "OneVue has been dealing with Sargon matters now for an extended period of time and without access to the $31m. OneVue did take the opportunity to strengthen our position as a creditor of Sargon in November when the extension of the deferred payment was granted. Although the high profile of this recent event is unfortunate it has not impacted our day to day operations nor do we expect it to in future."
The chair also remains positive on the company's outlook.
"The growth trajectory of the OneVue businesses was highlighted in the most recent quarterly where both Fund Services and Platform Services delivered record numbers. The new business opportunities across the group are unprecedented and provide a strong pipeline for continued growth," he concluded.
