Net1 said it will buy 35% stake in Bank Frick

Advocate Neville Melville

Net1 said it is has entered into an agreement to acquire a 35% interest in Bank Frick & Co AG, a fully licensed bank with its headquarters in Balzers Liechtenstein.

According to a statement released by Net1 to the JSE, the completion of the investment is subject to approval from the Liechtenstein Financial Market Authority. Following the successful completion of this investment, the Company will have a two-year option to acquire a further 35% in Bank Frick.

Neither Bank Frick nor Net1 has not disclosed how much it will pay for the shareholding.

According to a disclosure released by Net1, Bank Frick provides a complete suite of banking services, with one of its key strategic pillars being the provision of payment services and funding of financial technology opportunities. Bank Frick holds acquiring licenses from both Visa and MasterCard and operates a branch in London.

Commenting on the proposed transaction, Serge Belamant, Chairman and Chief Executive Officer of Net1 said “We entered into a long term co-operation agreement with Bank Frick last year to become our strategic banking partner for the provision of the support and banking services required to deploy Net1’s products and services, including VCPay,
Finetrading and money remittances in Europe”.

He added that “We have received invaluable support from Bank Frick and we have jointly identified many exciting joint opportunities that would require funding, whether for our working capital finance, card issuing and acquiring or transaction processing activities.

We decided to become a strategic investor in Bank Frick to cement a critical component of Net1’s international activities as we are completely reliant on having a stable, long term and strategic relationship with a fully licensed bank – being a significant stakeholder is the best way to ensure alignment and longevity. We have agreed with Bank Frick that approximately USD 30 million of its free equity will be utilized as seed capital for a fund dedicated to our future
activities.”

On his part, Mario Frick, Chairman of the Board of Directors of Bank Frick said “Net1 possesses enormous digital know-how. With the expansion of Net1’s involvement, we will be able to strengthen our current business areas, drive forward our fintech strategy, develop new digital business models and enter new markets,”

He concluded that “Thanks to the scale effects this will bring, we can face the increasingly complex regulatory
environment more effectively.”

Net1 a provider of alternative payment systems that leverage its Universal Electronic Payment System (“UEPS”) or utilize its proprietary mobile technologies. The Company operates market-leading payment processors in South Africa and the
Republic of Korea. Through Transact24, Net1 offers debit, credit and prepaid processing and issuing services for Visa, MasterCard and China UnionPay in China and other territories across Asia-Pacific, Europe and Africa, and the United States.
Through Masterpayment, Net1 provides payment processing and enables working capital financing in Europe.

Bank Frick is a family-run Liechtenstein bank with headquarters in Balzers. It was founded in 1998 by Kuno Frick Sr. It is fully owned by the Kuno Frick Family Foundation.

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