Net 1 Gives Black Investors Option to Buy 19.9% of Shares
Net 1 UEPS Technologies Inc. said it agreed to issue a one-year option to black South African investors to buy 19.9 percent of the electronic-payment systems maker for $80 million to comply with local regulations.
The option, which will give investors the right to buy as many as 8.96 million shares in the company for $8.96 each, is subject to obtaining regulatory approval, the company said in a statement today.
“Our focus will be on helping expand Net 1’s product offerings in financial services and health-care processing, which will become increasingly important across the African continent with the advent of several large-scale national projects,” Brian Mosehla, chief executive officer of Mosomo Investment Holdings (Pty) Ltd., the lead partner in the black empowerment group, said in the statement.
South Africa’s black economic empowerment laws are meant to redress discrimination under apartheid by requiring some businesses to transfer stakes to black owners. The government considers the empowerment status of companies when contracts are awarded to suppliers.
“Our new partners will help strengthen the long-term sustainability of our business in South Africa,” Serge Belamant, chairman and chief executive officer of Net 1, said in the statement.
Net 1 dropped 3.1 percent, the most since Jan. 13, to $9.99 at 9:59 a.m. in New York, giving the company a market value of $450 million. The stock has retreated 14 percent in the past 12 months.
To contact the reporter on this story: Jana Marais in Johannesburg at email@example.com
To contact the editor responsible for this story: Antony Sguazzin at firstname.lastname@example.org