After years of being the top funded sector, African fintech and financial services startups are making the headlines for even more lucrative reasons.
DPO Group, a payments services provider for African businesses, has been acquired by Network International, a Dubai-headquartered payments giant in a $288 million deal. The acquisition will see DPO Group continue to operate under the same brand while being wholly owned by Network International. DPO Group’s executives will own stock in Network International as part of the transaction.
After decades of being mainly focused on serving Middle East clients, the acquisition of DPO Group allows Network International boost its Africa operations.
Nairobi-based DPO Group already provides payments services to nearly 50,000 merchants across the 19 African countries it currently operates. Early projections show Africa could account for 40% of Network International’s annual revenues by 2024, up from 27% last year. DPO Group had raised a total of $15 million in funding in two rounds which were both led by London-based financial services investor Apis Partners, Crunchbase data shows.
The company’s acquisition is also validation of sorts for Africa-focused technology ventures. Following years of record-breaking investment in African startups, there has been a growing expectation of a shift towards the possibility of big-money exits for investors in the continent’s maturing ecosystems. It’s a sentiment highlighted by Partech Africa, a Africa-focused venture fund, in its 2019 funding report. As Tidjane Dème, the fund’s general partner, noted to Quartz Africa, the next “test” for local ecosystems will be “whether there is liquidity in buying and selling [African] startups.”
Yet, only a month ago, MFS Africa, the pan-African payments gateway, acquired Beyonic, an enterprise-focused digital payments services provider.
DPO Group, which was founded in 2006, has acquired five smaller financial services companies operating on the continent since its founding. The latest of those deals came last year when it acquired PayFast, the South African payments processing service.
Its expansion has also taken it into Tanzania, Uganda, Zambia, Rwanda, Ethiopia, Zimbabwe, South Africa, Namibia, Botswana, Malawi, Mauritius, Ghana and Nigeria.
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