Lesaka Technologies’ share price shot up 17.1% Friday morning after announcing it has entered into a R1.091 billion agreement to acquire 100% of South Africa’s digital lender, Bank Zero Mutual Bank.
The companies said Friday the acquisition will be settled through a combination of new shares—such that the shareholders of Bank Zero will own about 12% of Lesaka’s shares at the time of completion of the proposed transaction—and up to R91 million in cash.
“The acquisition of Bank Zero is a transformative event in Lesaka’s journey, enabling us to better serve our consumers, merchants, and enterprise clients by embedding a trusted, well-engineered neobank capability into our fintech platform,” said Lesaka chairman Ali Mazanderani in a statement.
“Our focus has always been on using technology to remove friction, lower costs, and challenge legacy banking norms. Joining forces with Lesaka allows us to accelerate that mission at scale—reaching more customers, faster. It represents a critical step for Lesaka and Bank Zero in realising new revenue streams, improving capital efficiency, and unlocking synergies across our ecosystem,” said Bank Zero CEO Yatin Narsai.
The 12% stake is valued at about R1bn based on the R88.26 share price. The share price was trading at R81.99 on Friday monring. The selling shareholders of Bank Zero—which include its chairman Michael Jordaan, CEO Yatin Narsai, and other key members of the bank—will collectively hold a 12% stake in Lesaka.
The transaction is still subject to the regulatory approvals such as by the Prudential Authority and Competition Commission.
Bank Zero, founded in 2018, is built on modern technology on an app-driven platform and a zero-fee banking model, offering retail and commercial banking services.
As of the end of April 2025, Bank Zero had a deposit base in excess of R400m and more than 40 000 funded accounts across South Africa.
Bank Zero’s digital banking infrastructure and its operational banking licence, together with Lesaka’s fintech and distribution platform, would transform the way Lesaka is able to conduct business in the future, said Mazanderani.
These include better servicing of Lesaka’s customers through full banking services, unlocking synergies and opportunities, accelerating innovation, and streamlining Lesaka’s Consumer, Merchant, and Enterprise divisions—all enabling a shift in the financial profile of Lesaka and empowering the combined group to deliver greater value to consumers and businesses.
“Lesaka expects the transaction to support a more optimised balance sheet in the future, allowing the group to finance the existing and continued growth in lending books through customer deposits, driving stronger lending unit economics,” Lesaka said.
In addition, the reduction in the use of bank debt in the group’s Consumer and Merchant divisions would help to deleverage Lesaka’s debt. After the deal, Lesaka could achieve a more than R1bn reduction in debt.
Lesaka said it expects the transaction to be accretive to shareholders, with Bank Zero expected to be profitable in the fiscal year after the deal is completed. Further details would be published when Lesaka releases its annual results on or about September 4, 2025.
In the third quarter to March 31, Lesaka’s R2.5bn revenue was at the midpoint of its revenue guidance, and lower than the R2.6bn in the third quarter of 2024.
Operating income of R10.9m was lower than operating income of R15m in the third quarter of 2024, given R42.3m one-off transaction costs versus R17.1m transaction costs in the same period in 2024. The net loss, including a tax-adjusted R310.6m non-operating charge in fair value of a non-core asset, increased to R404.3m compared to a net loss of R4m in the third quarter of 2024.
Visit:www.businessreport.co.za
