Lesaka Technologies, the South African fintech firm formerly known as , is set to buy South African digital-only institution Bank Zero Mutual Bank in a deal worth R1.1bn (US$62m).
Under the terms of the agreement, which is still subject to regulatory approval, Lesaka will acquire100% of issued ordinary shares of Bank Zero. In return, Bank Zero shareholders will receive 12% of the diluted shares and up to $5.1m in cash.
Founded in 2018, Bank Zero has a deposit base of ZAR400m and more than 40,000 funded accounts across South Africa
According to a statement, the transaction "marks another key milestone in Lesaka’s journey to build a vertically integrated fintech platform" by combining its digital infrastructure with Bank Zero's bankiing license and custome base.
In addition, the Bank Zero executive team is set to stay in place for the interim, including chairman Michael Jordaan and CEO Yatin Narsai.
“This transaction reflects a strategic partnership underpinned by long-term alignment, which will result in the continued involvement of all Bank Zero founders and management," said Jordaan. "Our belief in the combined platform’s future is clear and we see strong symmetry in our vision."
Lesaka chairman Ali Mazanderanicalled the acquisition a "transformative event" in the company's journey.