Lesaka acquires fintech SA Adumo for $85.9 million

South African fintech company Adumo has been acquired by its counterpart Lesaka in a deal worth ZAR1.59 billion ($85.9 million), subject to regulatory and shareholder approval.

Adumo is South Africa’s largest independent payment processor, helping approximately 23,000 active merchants with operations such as card acquiring, integrated payments and reconciliation services. raise $15 million in IFC funding in 2021has been on something of an acquisition spree, buying companies like SwitchPay, WireCard, GAAP, SureSwipe, iKhokha and other smaller payments companies.

Now it has been acquired by itself, by Lesakaa South African financial technology company that uses its proprietary banking and payment technologies to provide superior financial services solutions to merchants and consumers in Southern Africa.

The acquisition price is ZAR1.59 billion (US$85.9 million), which will be settled by combining an issue of 17,279,803 ordinary shares of Lesaka to the current ultimate shareholders of Adumo, plus ZAR232 million (12.5 million US dollars) in cash. Adumo’s ultimate shareholders include Apis Growth Fund I, a private equity fund managed by Apis Partners LLP; African Rainbow Capital, the largest shareholder of Crossfin Holdings; as well as the management of IFC and Adumo.

Adumo’s core operations include card acquiring, integrated payments and reconciliation services, and it serves around 23,000 active merchants, processing over ZAR24 billion (USD1.3 billion) in throughput per year. The company’s corporate card services cover more than 245,000 cardholders and support payroll, incentives, rewards and expense management. Adumo ISV, also known as GAAP, is the largest provider of software-as-a-service and POS solutions to the hospitality sector in Southern Africa.

After completing the acquisition, the Lesaka ecosystem will serve 1.7 million active consumers, 119,000 merchants and process more than ZAR 250 billion annually. The group will have more than 3,300 employees operating on the ground in five countries: South Africa, Namibia, Botswana, Zambia and Kenya. The company said the acquisition reinforced its position as the “natural consolidator” of southern Africa’s fintech and would enhance its strengths in both the consumer and commercial markets.

“We are delighted to welcome the Adumo team to the Group and Adumo CEO Paul Kent to our executive leadership team. Adumo’s customer base gives us access to more than 245,000 consumers and payment technologies that we can incorporate into our existing operations. The pending acquisition of Adumo is another important milestone for Lesaka as we build the leading fintech platform in Southern Africa,” said Lincoln Mali, CEO of Lesaka Southern Africa.

Adumo co-founder and CEO Paul Kent said he looked forward to joining forces with the Lesaka team and “contributing to the continued success of the Lesaka story.”

“Our combined offering will significantly enhance the customer value proposition and is a natural fit considering our respective strengths and technology offerings,” he said.