An airbrush image of Flash services
Pepkor Holdings has announced the merger of Flash, its fintech subsidiary, with merchant-focused trade enablement and fintech platform Shop2Shop, to create one of South Africa’s preeminent merchant commerce and fintech platforms, with annual throughput exceeding R200 billion.
This means that Pepkor shareholders can look forward to a planned future listing of the new merged platform, called FintechCo, possibly within 3 years. Shop2Shop is a fast-growing platform that provides acquiring, payments, cash management and business enablement solutions to small businesses, traders, and suppliers.
The date of the listing will depend on the speed of integration the two businesses, the market conditions, and with some time to build up a financial reporting history of the merged company, said Pepkor chief financial officer, Rian Hanekom, in an online presentation on Wednesday.
Pepkor will hold a controlling interest of about 57.1% in FintechCo, the new platform, with Shop2Shop owners and management holding the rest. The transaction implies an equity valuation of about R21.3bn and is expected to unlock meaningful operational synergies.
