Lesaka to expand its Merchant Division’s Footprint in South Africa’s Informal Market with the acquisition of Touchsides (Pty) Ltd from Heineken International B.V.

Touchsides has an active base of over 10,000 POS terminals across South Africa’s informal licensed taverns, and processes more than 1.5 million transactions per day. The business provides platform-as-a-service (PaaS) and software-as-a-service (SaaS) solutions to licensed tavern outlets, enabling the measurement of sales activity in real-time, management of stock levels and informing commercial decisions, such as pricing and promotional offers. The data and insights gathered from these terminals carries significant value and potential to be monetized through relationships with a range of clients including fast-moving consumer goods companies, retailers, wholesalers, route-to-market suppliers, and financiers.

The licensed tavern market in South Africa consists of an estimated 45,000 establishments, is a major vertical in South Africa’s informal market and provides a real growth opportunity for Kazang.

Lesaka head of Merchant Division and CEO of Connect Steve Heilbron said: "Touchsides is an exciting acquisition target and aligns perfectly with our strategy of adding scale and broadening our service offering in our Merchant division. With its installed network and deep data and insight capabilities, we expect to have a strong platform to better understand and further penetrate South Africa’s informal markets."

"We have identified multiple growth levers from this acquisition that we are ready to execute on," added Heilbron. "Operating as an independent company unaffiliated to a major beverage supplier, we see a distinct opportunity to significantly grow Touchsides' tavern base and to monetize its real-time data. Additionally, we see opportunities for Kazang not only in providing services to Touchsides base, but also in leveraging its data monetization experience and point-of-sale expertise across our large informal merchant base outside of the tavern industry."

The acquisition, funded by internal cash generation of the Group, is expected to close in March 2024 and is subject to satisfaction of customary closing conditions. As part of the acquisition, Heineken’s operating business in South Africa has agreed to a long-term renewable contract with Touchsides for access to Touchsides’ tavern data and services.

About Lesaka (www.lesakatech.com)

Lesaka Technologies, (Lesaka™) is a South African Fintech company that utilizes its proprietary banking and payment technologies to deliver superior financial services solutions to merchants (B2B) and consumers (B2C) in Southern Africa. Lesaka’s mission is to drive true financial inclusion for both merchant and consumer markets through offering affordable financial services to previously underserved sectors of the economy. Lesaka offers cash management solutions, growth capital, card acquiring, bill payment technologies and value-added services to formal and informal retail merchants as well as banking, lending, and 2 insurance solutions to consumers across Southern Africa. The Lesaka journey originally began as “Net1” in 1997 and later rebranded to Lesaka (2022), with the acquisition of Connect. As Lesaka, the business continues to grow its systems and capabilities to deliver meaningful fintech-enabled, innovative solutions for South Africa’s merchant and consumer markets.

Lesaka has a primary listing on NASDAQ (NasdaqGS: LSAK) and a secondary listing on the Johannesburg Stock Exchange (JSE: LSK). Visit www.lesakatech.com for additional information about Lesaka Technologies (Lesaka ™).

About Kazang (www.kazang.com)

Kazang is a leading provider of cash and digital solutions to merchants in Southern Africa’s informal economies. Its fintech solutions include a wide range of value-added services (VAS), card acquiring, secure cash vaults and supplier payments platforms. Kazang operates a network of over 75,000 active devices, and processes around 2.2 million transactions daily.

Kazang is dedicated to helping small and medium merchants grow and succeed, through increasing their sales, making their businesses more efficient and reducing their risks with its holistic portfolio of products and services.