Net1 UEPS Technologies has terminated a deal with Blue Label Telecoms to join as a party for the restructuring of mobile operator, Cell C.
However, Net1 said it will continue to pursue its acquisition of a 15% interest in the issued share capital of Cell C for a consideration of R2 billion.
Blue Label Telecoms and Net1 subsidiary, Net1 SA, have mutually agreed that Net1 SA will not subscribe for shares in Blue Label, and the subscription agreement has therefore been terminated, Net 1 said in a statement on Thursday.
The company has also been released from its R2 billion guarantee issued by FirstRand Bank, acting through its Rand Merchant Bank division, in favour of Blue Label.
Net1 is a provider of alternative payment systems that leverage its Universal
Electronic Payment System or utilize its proprietary mobile technologies.
The company said it continues to make substantial progress toward finalizing terms to acquire a non-controlling interest in DNI-4PL Contracts, with an option to acquire a controlling stake in DNI in the future.
“The proposed investments in Cell C and DNI are subject to certain conditions, including
the satisfactory completion of due diligence, the required internal and external
approvals and the execution of definitive transaction agreements.
“The company intends to settle the purchase consideration for these two investments using a combination of surplus cash and debt. The company does not intend to issue any shares of common stock to fund these two investments,” Net1 said.
Net1 has a primary listing on the NASDAQ and a secondary listing on the Johannesburg