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Why the Flexiroam (ASX:FRX) share price opened 7% higher today

Aaron Teboneras | March 19, 2021 3:23pm

FRXSPT

Flexiroam Ltd (ASX: FRX) shares opened 7.4% higher at 5.8 cents this morning after the company announced a joint marketing agreement to expand its partnership network. However, at the time of writing, the Flexiroam share price has retreated back to 5.4 cents, flat for the day so far.

Let’s take a look at what the mobile network operator announced.

What boosted the Flexiroam share price this morning?

Investors were temporarily pushing the Flexiroam share price higher this morning after digesting the company’s latest update.

According to its release, Flexiroam has signed a joint marketing agreement with Travala.com.

Founded in 2017, Travala.com is a leading cryptocurrency-based travel booking service with over 2 million properties listed worldwide.

Under the agreement, Travala.com customers will be offered a US$25 Flexiroam eSIM with a 500-megabyte global data plan when booking through the platform. In return, Flexiroam users will be provided with a US$25 Travala.com credit voucher when making any Flexiroam purchase.

Both companies will engage in promoting the deal through the use of marketing programs.

The agreement will run for an initial period of 12 months, and be limited to 100,000 customers from each of Travala.com and Flexiroam.

This follows a previous contract Flexiroam signed with buy now, pay later company Splitit Ltd (ASX: SPT) earlier this month. Flexiroam is seeking to capture some of the untapped market in Malaysia and Singapore.

Flexiroam noted that the material impact of its latest agreement is not yet known due to the variable nature of the commission. This will be calculated based on customer usage of the Travala.com booking platform which cannot be accurately predicted.

Management commentary

Flexiroam managing director Jef Ong welcomed the new partnership, saying:

We are excited to be partnering with Travala.com, a leading cryptocurrency travel agency and the agreement will allow our Flexiroam Wallet customers to gain Travala.com credits for booking flights, hotels and holiday activities. We plan to commence joint marketing campaigns with Travala.com, to promote this initiative to our customers.

The Flexiroam share price has jumped more than 300% over the past 12 months, with most of these gains coming this year. Flexiroam shares reached a 52-week high of 9.6 cents in early February.

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Motley Fool contributor Aaron Teboneras owns shares of Splitit Ltd. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.