Net 1 UEPS Technologies, Inc. ("Net1" or the "Company") (NASDAQ: UEPS) (JSE: NT1) today announced that it has acquired the remaining 56% of Transact24 Limited ("T24"), a specialist Hong Kong-based payment services company. Net1 now owns 100% of T24, having acquired approximately 44% of T24 in May 2015. Philip Meyer, Managing Director of T24 and an industry veteran in the international payments and transaction processing industries, will become an executive officer of Net1.
The purchase consideration was settled using a combination of cash and through the issuance of 391,645 shares of Net1 common stock. The Company elected to settle part of the purchase price in shares in order to appropriately align the T24 management team with the Company and its global strategy. The issuance of the Net1 shares was not registered under the Securities Act of 1933, in reliance on an exemption from registration therefrom. In addition, 50% of the Net1 shares issued in the transaction are contractually restricted as to resale until after June 30, 2016, and the remaining 50% of the shares are so restricted until after June 30, 2017.
During November and December 2015, the Company repurchased 749,123 shares of its common stock for approximately $11.2 million under its share repurchase program. Therefore, these share repurchases will more than offset the number of shares issued in the T24 transaction.
"We are very pleased to welcome the T24 team as a wholly-owned subsidiary of the Group. During our short history together, we have already identified many strategic opportunities and we look forward to them playing an integral role in scaling up Net1's businesses internationally, including in China," said Dr. Serge Belamant, Chairman and CEO of Net1.
About Net1 (www.net1.com)
Net1 is a leading provider of alternative payment systems that leverage its Universal Electronic Payment System ("UEPS") or utilize its proprietary mobile technologies. The Company operates market-leading payment processors in South Africa and the Republic of Korea.
UEPS permits the Company to facilitate biometrically secure, real-time electronic transaction processing to unbanked and under-banked populations of developing economies around the world in an online or offline environment. Net1's UEPS/EMV solution is interoperable with global EMV standards that seamlessly enable access to all the UEPS functionality in a traditional EMV environment. In addition to payments, UEPS can be used for banking, healthcare management, payroll, remittances, voting and identification.
Net1's mobile technologies include its proprietary mobile payments solution -- MVC, which offers secure mobile-based payments, as well as mobile banking and prepaid value-added services in developed and emerging countries. The Company intends to deploy its varied mobile solutions through its ZAZOO business unit, which is an aggregation of innovative technology companies and is based in the United Kingdom.
Net1 has a primary listing on the NASDAQ and a secondary listing on the Johannesburg Stock Exchange.
About Transact24 Ltd. (
www.transact24.com
)
Transact24 Ltd. is a Hong Kong based Payment Service Provider ("PSP") with offices and/or service entities in Australia, Singapore, China, Mauritius, South Africa, Austria, Gibraltar, Saipan, the USA and the UK.
Established in 2006, Transact24 Ltd. (via its various wholly-owned subsidiaries) has processing relationship with several acquiring banks and processing institutions word-wide and offers Internet Merchants payment options such as Visa, MasterCard, Chinese Debit Cards and Auto Clearing House ("ACH").
In 2009, Transact24 Ltd. became a Program Manager for the issuing of Visa branded transactional prepaid cards. The Prepaid cards are issued by CashFlows, a UK based Financial Conduct Authority regulated Visa Europe Issuer. The Prepaid Program management is done via Transact24 Trading Ltd. (Gibraltar) and Transact24 (UK) Ltd.
In 2014, T24 became a Program Manager for the issuing of China UnionPay ("CUP") cards and launched a T24 branded HK$ CUP prepaid card.
Forward-Looking Statements
This press release contains forward-looking statements that involve substantial risks and uncertainties. All statements, other than statements of historical fact, included in this press release regarding strategy, future operations, future financial position, future revenues, projected costs, prospects, plans and objectives of management are forward-looking statements. The Company may not actually achieve the plans, intentions or expectations disclosed in its forward-looking statements. Actual results or events could differ materially from the plans, intentions and expectations disclosed in the forward-looking statements that the Company makes. Factors that might cause such differences include, but are not limited to: the risk that the Company's business and the T24 business will not be integrated successfully; the possibility that the expected synergies from the acquisition will not be realized, or will not be realized within the expected time period; disruption from the acquisition making it more difficult to maintain business and operational relationships; and other factors, many of which are beyond the Company's control; and other important factors included in the Company's reports filed with the Securities and Exchange Commission, particularly in the "Risk Factors" section of the Company's Annual Report on Form 10-K for the fiscal year ended June 30, 2015, as such Risk Factors may be updated from time to time in subsequent reports. The Company does not assume any obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.
