Lesaka to acquire Recharger for $28M

Lesaka (LSAK) announced that it has signed a definitive agreement to acquire 100% of the issued and outstanding ordinary shares of Recharger, a South African prepaid electricity submetering and payments business. The purchase consideration of ZAR 507M, or $28M, will be paid over two tranches with the first tranche settled at closing and the second tranche a year later. The purchase consideration will be settled through a combination of ZAR 332M, or $18M in cash and ZAR 175M, or $10M, in shares of Lesaka common stock. The share price applied to determine the number of shares of Lesaka’s common stock to be issued for the equity consideration will be based on the volume-weighted average price of Lesaka shares for the three-month period prior to the disbursal of each tranche. Lesaka will also make a ZAR 43M contribution to Recharger at closing which will be used exclusively to repay a loan due by Recharger to the seller. The company expects the transaction to be concluded at an EV/EBITDA multiple of approximately six times. Recharger is expected to sit within the Enterprise pillar of Lesaka’s merchant division. The company expects the acquisition to act as an entry point into the South African private utilities space while augmenting the Enterprise pillar’s alternative payment offering. The transaction is expected to close in Lesaka’s third quarter of fiscal 2025 and is subject to regulatory approvals and satisfaction of customary closing conditions.