Cape Town - Net 1 UEPS Technologies on Wednesday announced two deals that it said will to create a “global first ... to provide customers a truly bespoke, affordable and comprehensive package that will go much further than basic telephony”.
Nasdaq and JSE-listed Net1 said it had agreed to spend R2 billion on a strategic stake in Blue Label, which would take its ownership in the JSE-listed company to approximately 15 percent.
Simultaneously, Blue Label announced its intention to acquire 45 percent of Cell C, the third largest telecom operator in South Africa.
The Net1-Blue Label deal “cements the start of a multi-layered strategic alliance “that will greatly enhance shareholder value on both sides through co-operation between our combined local and international operations”, according to Serge Belamant, chairman and chief executive of Net1.
Read also: Blue Label scoops Cell C stake
Net1's Universal Electronic Payment System (UEPS) facilitates biometrically secure, real-time electronic transaction processing in an online or offline environment to under-banked populations in developing economies. Blue Label - which operates in South Africa, Mexico and India - is a market leading virtual and physical distributor of secure electronic tokens including prepaid airtime, starter packs, data and electricity.
The JSE-listed company also provides transactional services, including ticketing and financial services. The two would combine to offer customers services including banking, micro-finance, insurance, distribution of airtime and electricity, voice and data as well as low-cost handsets with the most advanced functionality.
The combination of the Net1 and Blue Label infrastructures would provide comprehensive coverage throughout South Africa, including physical and mobile branches, associations with merchant stores and virtual distribution services via USSD, voice, internet and social media linked with traditional payment systems including EFTs, debit and credit cards and Net1's Virtual Card solution.
Belamant said: “In addition, the new alliance ensures that all required support services are provided in-house using our own combined technologies, software and hardware products. As a result, our technology platform can address and service the entire LSM1 to 8 categories in South Africa in a broad and meaningful way.”
The statement added there were also compelling opportunities to extend their collaboration in other markets, including India and Mexico.
Brett and Mark Levy, Blue Label's joint chief executives, said: “The strategic co-operation between Blue Label and Net1 will touch multi-million consumers per day through our combined points of presence as a result of the respective parties' combining product, distribution footprint and customers, from formal and informal retail right through to the extensive rural market.
“This will create a highly robust business model that will be resilient to disintermediation and fluctuations in economic conditions.”
AFRICAN NEWS AGENCY