German payment services company Wirecard has purchased South Africa-based payment service provider MyGate Communications for €23.1m.
The transaction includes an upfront payment of €18.2m and earn out payments of up to €4.9m. It is believed that the acquired business will generate an EBITDA of €2m for the full calendar year 2017.
MyGate allows merchants across Africa to accept a number of different e-commerce payment options, especially online card payments, thereby enabling them to serve millions of African consumers.
MyGate is also connected to the leading acquiring banks in Africa and it has a workforce of 21 employees.
Wirecard said: “The acquired PSP business along with its integration into Africa’s leading acquiring banks and the Visa network offers enormous value added for Wirecard’s regional product portfolio and supplements the existing product portfolio offered by our subsidiary Wirecard South Africa.
“This merger speeds up our expansion into Africa's international markets and offers further potential to leverage synergies. In future, African merchants will receive a comprehensive payment solution along the entire value-added chain from a single source.”
Wirecard noted that the acquired PSP business will be beneficial for its IP-based payment and risk management technology, which is likely to be expanded with additional value-added services.