Resources How to Tender Tender Articles Tender Sectors Tender News

Net1 puts aside court case with deal

Net1 UEPS Technologies has put aside its looming court case with the SA Social Security Agency (Sassa) and cemented its business operations by teaming up with Blue Label Telecoms in the country. The Nasdaq- and JSE-listed company announced yesterday that it had entered into a share subscription agreement with Blue Label to subscribe for approximately 117.9 million shares in the telecoms company at a subscription price of R16.96 a share. It said this represented a 10 percent discount to R18.84, being the 30-day volume weighted average price of Blue Label shares traded on September 29. The aggregate subscription consideration payable by Net1 would be R2 billion. “This investment cements the start of a multilayered strategic alliance between our two groups that will greatly enhance shareholder value on both sides through co-operation between our combined local and international operations,” said Serge Belamant, the chairman and chief executive of Net1.

Blue Label joint chief executive Brett Levy said the strategic co-operation would touch millions of consumers through the companies’ combined points of presence. “This will create a highly robust business model that will be resilient to disintermediation and fluctuations in economic conditions,” Levy said. In May, Sassa, which oversees the payment of welfare grants to more than 16 million people, amended its rules to prevent what it said were illegal deductions for goods and services directly from grants ranging from funeral insurance to cellphone airtime. Net1, which has the contract to distribute South Africa’s R129bn in annual welfare payments, said it was not concerned about the outcome of a court case that could stop deductions for services such as funeral insurance. The case is set to be heard towards the end of October and the decision will be announced in November.

Source: www.iol.co.za

BACK TO NEWS

Net1 puts aside court case with deal

Latest News