Net1 to record non-cash fair value write-down of Cell C investment as of June 30, 2019
19 September 2019 - 3:30PM
Net 1 UEPS Technologies, Inc. (NasdaqGS: UEPS; JSE: NT1) (“Net1” or
the “Company”) today announced that Blue Label Telecoms Limited
(JSE: BLU) (“Blue Label”), the largest shareholder in Cell C Ltd
(“Cell C”), has issued an updated trading statement informing its
shareholders that Blue Label is impairing its Cell C investments to
nil for the year ended May 31, 2019. Net1 believes that the fair
value of Cell C at June 30, 2019 (Net1’s fiscal year end) is nil
($0) and expects to record a non-cash fair value adjustment to
reduce its carrying value in Cell C to nil. Net1 financial results
for the fourth quarter and year ended June 30, 2019, will be
released on September 26, 2019.
As previously disclosed, Cell C is currently
engaged in a comprehensive restructuring plan with its stakeholders
and Net1 remains fully supportive of this process. There have been
several positive developments in this process since June 30,
2019.
“The decisions of Net1 and Blue Label to write
down the value of their respective equity holdings do not impact
Cell C’s operations, DNI’s distribution capabilities or the
proposed transactions being pursued by it,” said Herman Kotzé, CEO
of Net1. “We believe that Cell C’s long-term prospects will
significantly improve once it has been recapitalized.”
Forward-Looking Statements
This press release contains forward-looking
statements that involve substantial risks and uncertainties. All
statements, other than statements of historical fact, included in
this press release regarding cost synergies, liquidity and strategy
are forward-looking statements. The Company may not actually
achieve the plans, intentions or expectations disclosed in its
forward-looking statements. Actual results or events could differ
materially from the plans, intentions and expectations disclosed in
the forward-looking statements that the Company makes. Factors that
might cause such differences include, but are not limited to, Cell
C’s failure to successfully recapitalize and improve its business,
as well as other factors, many of which are beyond the Company’s
control, and other important factors included in the Company’s
reports filed with the Securities and Exchange Commission,
particularly in the “Risk Factors” section of the Company’s Annual
Report on Form 10-K for the fiscal year ended June 30, 2018, as
such Risk Factors may be updated from time to time in subsequent
reports. The Company does not assume any obligation to update any
forward-looking statements, whether as a result of new information,
future events or otherwise.
About Net1 (www.net1.com)
Net1 is a leading provider of transaction
processing services, financial inclusion products and services and
secure payment technology. Net1 operates market-leading payment
processors in South Africa and the Republic of Korea.
Net1 offers debit, credit and prepaid processing and issuing
services for all major payment networks. In South Africa, Net1
provides innovative low-cost financial inclusion products,
including banking, lending and insurance and through DNI is a
leading distributor of mobile subscriber starter packs for Cell C,
a South African mobile network operator. Net1 leverages its
strategic equity investments in Finbond and Bank Frick (both
regulated banks), and Cell C to introduce products to new customers
and geographies. Net1 has a primary listing on NASDAQ (NasdaqGS:
UEPS) and a secondary listing on the Johannesburg Stock Exchange
(JSE: NT1). Visit www.net1.com for additional information about
Net1.
Investor Relations Contact:
Dhruv ChopraGroup Vice President Investor RelationsPhone:
+1-917-767-6722Email: dchopra@net1.com
Media Relations Contact:
Bridget von HoldtBusiness Director – BCWPhone:
+27-82-610-0650Email: bridget.vonholdt@bm-africa.com
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