The group said that it intended to invest in tranches, with R30m investment expected to be completed yesterday.
It said one of the company’s strategic directives was the investment into private equity investments.
“The board has identified VSS as a value-adding investment. The anticipated dividend yield on the investment will further enhance Ecsponent’s after tax returns,” it said. VSS falls under private equity investment.
Ecsponent operates in South Africa, Botswana, Namibia, Swaziland and Zambia.
Coming back to the investment, Ecsponent said VSS was 100percent held by financial technology company MyBucks.
In April last year, Ecsponent acquired a 10 percent stake in MyBucks for about R263m.
The group said the acquisition would give the group an opportunity to derive some of its income in foreign currencies as MyBucks was listed on the Frankfurt Stock Exchange.
Ecsponent said VSS currently provides group information technology to the MyBucks group of companies and is the entity through which the MyBucks group undertakes its information technology development.
Despite VSS reporting a loss in its year-end results, Ecsponent believes it can turn around the results.
VSS reported a net loss after tax of R17m for the year to end June. However, the group was confident that VSS has potential and has invested significantly in developing its service offering, which has resulted in the company securing profitable contracts during 2017.
The group said VSS would be rebranded as a fintech entity, geared toward the provision of artificial intelligence and information technology support services to both the MyBucks group and the Ecsponent group, as well as to external fintech-related entities.
It will also target mobile network operators and smaller financial services groups.
- BUSINESS REPORT