Lesaka Technologies Acquires Adumo for R1.67 Billion
Lesaka Technologies, a listed fintech company, has officially completed its acquisition of Adumo for a total consideration of R1.67 billion ($96 million). This deal significantly strengthens Lesaka’s payment processing capabilities, adding to its growing portfolio of fintech solutions across Africa.
The acquisition was finalized with a combination of approximately 17 million Lesaka shares and a cash payment of R232.2 million ($13 million). This is $10 million higher than the figure previously reported in May 2024. The increase reflects a 27% rise in Lesaka’s share price, signaling positive investor sentiment around the transaction.
Why This Acquisition Matters
Lincoln Mali, CEO of Lesaka Technologies Southern Africa, expressed excitement about the deal, calling it a pivotal moment for the company.
“The Adumo transaction is an exciting addition to the Lesaka story. It significantly enhances our technology platform, adding customers, solutions, and meaningful scale,” said Mali.
With this acquisition, Lesaka is poised to expand its fintech reach, particularly in South Africa, where Adumo’s card-acquiring point-of-sale (POS) devices and integrated payment solutions have already made a strong impact. Adumo services 23,000 merchants and 240,000 consumers, and prior to the deal, it processed R24 billion ($1.3 billion) in transactions annually.
As part of the integration, Paul Kent, CEO of Adumo, will join Lesaka’s executive leadership team and oversee the merchant division, which is expected to grow as South Africa’s interest rate-cutting cycle begins. Additionally, Dean Sparrow, CEO of Crossfin Technology Holdings, will join the Lesaka board as a non-executive director.
Growth Opportunities and Market Expansion
This acquisition is a growth opportunity for Lesaka and a chance to improve its technological capabilities. It also strengthens Lesaka’s position against key competitors like YOCO, which operates only in South Africa. Lesaka, with a market capitalisation of $310 million, owns payment providers EasyPay and Kazang. In February 2024, it also acquired Touchsides from Heineken.
Following the merger, Lesaka can now serve 1.7 million active consumers and 120,000 merchants. It processes over R270 billion ($15.5 billion) in transactions annually. The company employs over 3,300 staff in South Africa, Namibia, Botswana, Zambia, and Kenya. This expansion solidifies its presence in the African fintech landscape.
What This Means for South Africa’s Fintech Space
Lesaka is now in a prime position to grow its payment solutions offerings, especially in South Africa’s diverse economy. The country’s economic sectors, including manufacturing, mining, agriculture, and tourism, are poised to benefit from Lesaka’s enhanced payment processing infrastructure.
For South African merchants, the merger means better access to advanced payment solutions, with the support of Adumo’s POS devices and Lesaka’s wide-reaching financial platform. The acquisition was greenlit by Lesaka’s shareholders and South Africa’s Competition Commission in September 2024, marking a smooth regulatory transition.
Financial Outlook
Lesaka reported an 11% revenue increase to R10.6 billion ($609 million) but a net loss of R326 million ($18.7 million). The Adumo integration is expected to boost Lesaka’s competitive edge, improving efficiency and financial performance through strategic synergies.
Lesaka has also signaled its intention to continue its growth strategy by identifying potential acquisition targets, ensuring its presence and influence in Africa’s fast-growing fintech space remain strong.
