CAB Payments' New CEO Lacks Skin in the Game as Takeover Bid Hangs Over Execution Risks

The board has handed the reins to a seasoned finance man, but the targets ahead are steep. Neeraj Kapur, the former CFO of Vanquis Banking Group, officially took over as CEO in June following a handover period with outgoing CEO Bhairav Trivedi. His mandate is clear: build on the recent turnaround. The company's 2025 results showed a solid reset, with total income rising 12% and adjusted EBITDA growing 14%. More specifically, income excluding net interest income-a key metric for the core payments business-climbed 17% last year.

Now, the board wants that momentum to accelerate. Management has set a medium-term target for income excluding net interest income of a high-teens to low-20s percentage CAGR. That's a significant step up from the recent 17% pace. The path, however, faces immediate headwinds. The company is facing a year-on-year drag on net interest income expected in 2026, pressured by lower US dollar rates. This creates a tough balancing act: grow the core business aggressively while navigating a near-term earnings drag.

The compensation structure is designed to align Kapur with these ambitious goals. Yet, the smart money's first signal is missing. Despite the high-stakes assignment, there is no evidence that Kapur has purchased any CAB Payments shares since his appointment. In a world where insider buying is a primary signal of skin in the game, his lack of a personal stake raises a quiet question. The board is betting on his experience to deliver tough targets, but the market will be watching to see if his financial commitment matches his stated belief in the company's long-term future.

Smart Money Moves: Insiders and the LTIP

The board's new CEO has a clear performance target, but the smart money's pattern is a mixed bag. Recent insider transactions show a flurry of activity, but no clear concentrated buying or selling. Over the past two years, we see a series of trades from various entities, including a sale of 486,534 shares at 1.24p by Harspring Capital in March. Yet, there's also significant buying, like Hewes Fund Management purchasing 545,802 shares at 1.09p just days earlier. This choppy trading from major holders suggests a market divided on the near-term outlook, with no single whale wallet making a definitive statement.

For the new CEO, Neeraj Kapur, the compensation structure ties his pay to those ambitious targets. His total package is £501.1k, with a base salary accounting for 71.77% of that. The rest is performance-based, aligning his interests with hitting the high-teens to low-20s CAGR goal. Yet, the critical signal of skin in the game is absent. His ownership stake is listed as 'n/a' in the latest data, meaning there's no public record of him holding company shares. In a turnaround story where personal investment often signals conviction, his lack of a stake is a notable gap.

The stock's recent volatility underscores the uncertainty. After a brutal 70% plunge last year, the shares have rebounded, but the rally is fragile. Just last week, the stock dropped 3.3% to close at 88.00p. That move, following a series of acquisition attempts and cancellations, shows the market remains sensitive to news and lacks a clear consensus. For all the talk of a new CEO and a new strategy, the insider trading tape and the CEO's own wallet tell a story of caution. The performance targets are set, but the alignment of interest is still being written.

Institutional Accumulation and the Takeover Bid

The institutional moves tell a story of selective interest, not broad conviction. While some major players are trimming positions, others are quietly adding. In early March, Harspring Capital Management sold 486,534 shares at 1.24p. Yet, just days before that sale, BlackRock bought 10,328 shares at 1.13p. This choppy trading from the big funds suggests a market of cautious observers, not a group of whales betting heavily on a single direction.

That uncertainty is now framed by a potential catalyst. The board has confirmed it received an unsolicited proposal from StoneX Group Inc. to acquire CAB Payments for 95 pence per share in cash. That offer price sits well above the stock's recent trading level near 88p, creating a clear valuation floor on the table. The board is evaluating the bid, considering the company's improved 2025 performance, but there is no certainty a formal offer will follow.

For the smart money, this introduces a new layer of complexity. The takeover bid offers a potential exit at a premium, which could explain some selective selling. Yet, the lack of a firm commitment from StoneX means the stock remains exposed to the company's own operational execution. The institutional tape shows no definitive accumulation, and the board's cautious stance on the bid keeps the long-term story in flux.

Catalysts and Risks: What to Watch

The smart money's patience will be tested by a handful of near-term events. The primary catalyst is the board's decision on the StoneX takeover bid. The unsolicited offer for 95 pence per share in cash provides a clear valuation floor, but the board's evaluation is ongoing. There is no certainty a formal offer will follow, and the company has advised shareholders to take no action. This uncertainty is a major overhang; the stock's fate could swing dramatically based on whether StoneX commits or walks away.

A more persistent risk is the company's high executive turnover. The new CEO, Neeraj Kapur, has been in the role for just 2.1 years, while the board's average tenure is a mere 2.3 years. This lack of stability is a red flag for long-term strategy execution. The board recently confirmed it received the StoneX proposal, but the leadership team's own track record suggests a potential for another strategic pivot if the bid falls through.

Investors must watch the execution of the new CEO's plan. The company has expanded into New York and Abu Dhabi, but the real test is whether these moves drive the promised growth. Management's medium-term target is for income excluding net interest income to grow at a high-teens to low-20s percentage CAGR. The path is rocky, with a year-on-year drag on net interest income expected in 2026 due to lower US dollar rates. The company must generate capital for returns from late 2026 to meet its ambitious targets.

The bottom line is that the board's evaluation of the takeover bid is the immediate signal. If StoneX makes a firm offer, it validates the stock's recent rebound and provides a clear exit. If the bid is rejected or withdrawn, the market will have to price in the risk of another leadership change and the difficulty of hitting those high-teens growth targets with a new CEO still finding his footing. For now, the smart money is on the sidelines, waiting for the board's next move.