Controversial JSE-Listed Net 1, the company behind Cash Paymaster Services that used to run SA’s social grant payment system, is selling its South Korean business KSNET.
Net 1 is selling 100% of KSNET, a South Korean payment processor, to Stonebridge Capital and Payletter for $237 million (R3.4 billion).
The transaction, which is not subject to a financing condition, is expected to close in March 2020.
“KSNET is a profitable and cash generative business, but operates autonomously and in a more developed economy with limited overlap with the group’s other activities. We also believe that the intrinsic value of KSNET was not appropriately reflected in Net1’s overall valuation,” said Herman Kotzé, CEO of Net1.
“Therefore our Board commenced a strategic review of our various businesses and investments late last year, and ultimately decided to sell KSNET in order to focus more on our core strategy, boost liquidity and to maximize shareholder returns.
“We believe Stonebridge Capital and Payletter are the right strategic partners for KSNET, as they are committed to building further scale in the South Korean payments market,”
“This transaction marks a significant milestone in our strategic plan, and allows management to further focus on its core strategy of providing fintech solutions for the underbanked in South Africa, Africa, Europe and other emerging economies as well as our new blockchain related products,” he concluded.
The company will provide further details on its second-quarter fiscal 2020 earnings call on February 7, 2020.
FT Partners acted as exclusive financial advisor to Net1 and Yulchon LLC served as legal counsel.