Lesaka Completes $96.2 Million Acquisition of Adumo, Strengthening Fintech Presence in Southern Africa
Lesaka Technologies, Inc. has announced it has completed its acquisition of Adumo RF (Pty) Ltd (“Adumo”). The transaction was settled through the issuance of 17,279,803 shares of Lesaka’s common stock and a cash payment ZAR 232.2 million ($13.4 million), implying a total purchase consideration of ZAR 1.67 billion ($96.2 million) using Lesaka’s October 1, 2024, closing price on the Johannesburg Stock Exchange of ZAR 83.05 per share. All amounts in this release have been translated to U.S. dollars at the October 1, 2024, closing exchange rate of $1: ZAR 17.34.
The acquisition of Adumo, South Africa’s largest independent payments processor with over 20 years’ experience in payment solutions, reinforces Lesaka’s position as natural consolidator of Southern African fintech. The acquisition enhances the Company’s strengths in both its consumer and merchant markets and follows the successful integration of the Connect and Kazang businesses and the recent acquisition of Touchsides.
The Adumo transaction is an exciting addition to the Lesaka story. It significantly enhances our technology platform, adding customers, solutions, and meaningful scale. Lesaka’s full-service fintech platform will serve 1.7 million active consumers, 120,000 merchants, and process over ZAR 270 billion in throughput (ZAR 45 billion card, ZAR 105 billion VAS and ZAR 120 billion cash) per year in our connected ecosystem as we facilitate the digitization of commerce in our markets. The Group will have over 3,300 employees operating on the ground in 5 countries: South Africa, Namibia, Botswana, Zambia, and Kenya.
I would like to extend a warm welcome to all the Adumo employees, as well as Adumo Chief Executive Paul Kent who joins our executive leadership team. Paul will take responsibility for our merchant pillar. I would also like to welcome Crossfin Chief Executive Dean Sparrow who joins our board as a non-executive director and our new shareholders – Apis Growth Fund I and African Rainbow Capital, the largest shareholder of Crossfin.
Lincoln Mali, CEO Southern Africa, Lesaka
We are thrilled to be joining the Lesaka group, creating a Southern African fintech of significant scale, with leading positions in several verticals and sectors. Our businesses are a natural fit with the combined solution set, distribution network and technologies positioning us perfectly to take advantage of the digitization across our economy. We continue to innovate and expand the holistic suite of products and services offered to our merchants in solving for their pain points.”
Paul Kent, CEO, Adumo
This is an exciting day for us and for the customers that we serve. Bringing the Adumo business into the fold is a landmark transaction for Lesaka. The acquisition materially broadens our product offering to our customers and deepens our penetration in both the merchant and consumer segments. This will accelerate our growth profile. The combined scale and solutions of our fintech platform significantly enhances our ability to innovate and disrupt as well as providing a beachhead into new markets opportunities. There is a strong alignment of culture and values between Lesaka and Adumo, and we look forward to integrating our teams. I would also like to take this opportunity to welcome Paul Kent to Lesaka. We are very excited to have Paul and his team on board.
Steve Heilbron, Head of Corporate Development, Lesaka
In fulfilment of one of the conditions of the transaction, Lesaka has agreed to purchase 2,601,410 shares of its common stock, through a wholly owned subsidiary, for ZAR 207.2 million ($12.0 million), or ZAR 79.66 per shares, to provide cash liquidity to a group of indirect Adumo shareholders who were unable to receive Lesaka shares under their investment mandates. The purchase is expected to complete in early October 2024.
