| Acquisitions And Dispositions |
3. ACQUISITIONS AND DISPOSITIONS The cash paid, net of cash received related to the Company’s acquisition during the years ended June 30, 2026, 2025 and 2024, is summarized in the table below:
2026 2025 2024 Total cash paid $ 13,294 $ 24,161 $ 2,248 Less: cash acquired 2,177 11,215 665 Total cash paid, net of cash received $ 11,117 $ 12,946 $ 1,583 Acquisitions 2027 Proposed acquisitions of Bank Zero On June 26, 2025, Lesaka SA entered into a Transaction Implementation Agreement (the “Transaction Implementation Agreement”) with Zero Research Proprietary Limited (“Zero Research”), Bank Zero Mutual Bank (“Bank Zero”), and other parties identified in Annexure A to the Transaction Implementation Agreement (being all of the shareholders of Bank Zero save for Zero Research and Naught Holdings Ltd, the “Bank Zero Sellers”), the parties listed in Annexure B to the Transaction Implementation Agreement (being all of the shareholders of Zero Research save for Naught Holdings Ltd, the “Zero Research Sellers”) and Naught Holdings Ltd. All amounts below translated at the closing rate of $1: ZAR 17.76 The purchase consideration payable by Lesaka SA in exchange for the relevant shares in Bank Zero and the subscription consideration payable by Lesaka SA in exchange the subscription shares will be settled through a combination of delivery of Lesaka shares of common stock and up to ZAR 91.0 5.1 million) in cash. Zero Research will apply the cash and Lesaka shares received by it to settle the repurchase consideration due to the Zero Research Sellers. Following implementation of each of these steps, and subject to the below adjustment, the Bank Zero Sellers, Zero Research Sellers and Naught Holdings Ltd will own approximately 12 % of Lesaka's fully diluted shares at the time of completion of the proposed transaction. The Transaction Implementation Agreement allows a mechanism (in certain circumstances) pursuant to which the Bank Zero Sellers and the Zero Research Sellers may acquire fewer shares in Lesaka and a larger cash consideration. The Transaction Implementation Agreement includes customary interim period undertakings which required each of Zero Research and Bank Zero, among other things (i) to conduct their business in the ordinary course during the period between the execution of the Transaction Implementation Agreement and the closing of the transaction contemplated thereby, and (ii) not to engage in certain kinds of transactions during such period. The Transaction Implementation Agreement is subject to the fulfilment of certain conditions precedent. The Transaction Implementation Agreement will lapse if all of the conditions precedent are not met or not waived by January 31, 2027 (or such later date as may be agreed). Bank Zero and Lesaka SA have agreed to implement a long-term incentive arrangement following implementation of the transaction, under which an agreed portion of a number of shares of Lesaka's shares of common stock calculated will be granted by (i) 70.0 3.9 million) by an agreed value (as defined in the Transaction Implementation Agreement) (the “Retention LTIP Shares”) and (ii) dividing ZAR 30.0 1.7 million) by such agreed value (the “Performance LTIP Shares”). The Retention LTIP Shares will be subject to time and certain performance-based vesting conditions. The terms of the long-term incentive plan are required to be considered, and if necessary approved, by Lesaka's remuneration committee. The Company incurred transaction-related expenditures of $ 0.4 0.6 million during the years ended June 30, 2026 and 2025, respectively, related to the proposed acquisition of Bank Zero. The Company’s accruals presented in Note 13 of as June 30, 2026, includes an accrual of transaction related expenditures of $ 0.4 million and the Company expects to incur further transaction costs of $ 0.2 million during the 2027 fiscal year. 2026 Acquisitions Atom Operations Proprietary Limited On November 10, 2025, the Company, through its wholly owned subsidiary, Prism Holdings Proprietary Limited (“Prism”), entered into a Sale of Shares Agreement (the “Atom Purchase Agreement”) with Gravaton Investments Proprietary Limited (“Gravaton”) and Atom Operations Proprietary Limited (“Atom”). Pursuant to the Atom Purchase Agreement and subject to its terms and conditions, Prism agreed to acquire, and Gravaton agreed to sell, all of the outstanding equity interests in Atom for a total purchase consideration of $ 0.7 million which comprised of $ 0.4 6.0 million, translated at December 1, 2025 exchange rates) in cash and 76,716 shares of the Company’s shares of common stock (which had an aggregate value of $ 0.3 76,716 3.95 ) on closing). The transaction closed on December 1, 2025. The Company did not incur any significant transaction costs r elated to this acquisition. 3. ACQUISITIONS AND DISPOSITIONS (continued) 2026 Acquisitions (continued) Mobilemart Proprietary Limited On January 30, 2026, the Company, through Prism, entered into a Sale of Shares Agreement (the “Mobilemart Purchase Agreement”) with BASA Ventures Proprietary Limited (“BASA”) and Mobilemart Proprietary Limited (“MobileMart”). Pursuant to the Mobilemart Purchase Agreement and subject to its terms and conditions, Prism agreed to acquire, and BASA agreed to sell, all of the outstanding equity interests in MobileMart for a total purchase consideration of $ 2.5 40.0 February 6, 2026 exchange rates) in cash. The transaction closed on February 6, 2026. The Company did not incur any significant transaction costs related to this acquisition. These acquisitions were allocated to our Enterprise operating segment. Pro forma results related to acquisitions Pro forma results of operations have not been presented for the acquisitions of Atom and MobileMart because the effect of these acquisitions, individually and in aggregate, are not material to the Company. Since the closing of these acquisitions, they have contributed revenue and net loss of $ 10.9 0.2 million, respectively, for the year ended June 30, 2026. October 2024 acquisition of Adumo On May 7, 2024, the Company entered into a Sale and Purchase Agreement (the “Purchase Agreement”) with Lesaka SA, and Crossfin Apis Transactional Solutions (Pty) Ltd and Adumo ESS (Pty) Ltd (“the Sellers”). Pursuant to the Purchase Agreement and subject to its terms and conditions, Lesaka, through its subsidiary, Lesaka SA, agreed to acquire, and the Sellers agreed to sell, all of the outstanding equity interests and certain claims in the Adumo (RF) Proprietary Limited (“Adumo”). The transaction closed on October 1, 2024. Adumo is an independent payments and commerce enablement platform in Southern Africa, with operations across South Africa, Namibia, Botswana and Kenya. For more than two decades, Adumo facilitated physical and online commerce between retail merchants and end-consumers by offering a unique combination of payment processing and integrated software solutions, which currently include embedded payments, integrated payments, reconciliation services, merchant lending, customer engagement tools, card issuing program management and data analytics. Adumo operated across three businesses, which provided payment processing and integrated software solutions to different end markets: ● The Adumo Payments business offers payment processing, integrated payments and reconciliation solutions to small-and- medium (“SME”) merchants in South Africa, Namibia and Botswana, and the Lesaka Payouts Proprietary Limited, formerly known as Adumo Payouts Proprietary Limited , (“Lesaka Payouts”), business provides card issuing program management to corporate clients such as Anglo American and Coca-Cola (Lesaka Payments Proprietary Limited, formerly known as Adumo Payments Proprietary Limited (“Lesaka Payments”) was allocated to Merchant operating segment and Lesaka Payouts was allocated to the Consumer operating segment); ● The Adumo ISV business, Lesaka Hospitality Proprietary Limited, formerly known as GAAP Point of Sale Proprietary Limited (“Lesaka Hospitality”), has operations in South Africa, Botswana and Kenya, and clients in a number of other countries, and is the leading provider of integrated point-of-sales software and hardware to the hospitality industry in Southern Africa, serving clients such as KFC, McDonald’s, Pizza Hut, Nando’s and Krispy Kreme (Adumo ISV was allocated to Merchant operating ● The Adumo Ventures business offers online commerce solutions (Lesaka Online Proprietary Limited, formerly known as Adumo Online Proprietary Limited, (“Lesaka Online”)), cloud-based, multi-channel point-of-sales solutions (Humble Software Proprietary Limited (“Humble”) and an aggregated payment and credit platform for in-store and online commerce (SwitchPay Proprietary Limited (“SwitchPay”) to SME merchants and corporate clients in South Africa and Namibia (Adumo Venture was allocated to the Merchant operating segment). 3. ACQUISITIONS (continued) 2025 Acquisitions (continued) October 2024 acquisition of Adumo (continued) The total purchase consideration was ZAR 1.67 96.2 million) and comprised the issuance of 17,279,803 Company’s common stock (“Consideration Shares”) with a value of $ 82.8 17,279,803 4.79 cash of $ 13.4 million. The purchase consideration was settled through the combination of the Consideration Shares and a ZAR 232.2 million ($ 13.4 million, translated at the prevailing rate of $1: ZAR 17.3354 as of October 1, 2024) payment in cash. The Company’s closing price on the Johannesburg Stock Exchange on October 1, 2024, was ZAR 83.05 4.79 using the October 1, 2024, $1: ZAR exchange rate). Certain indirect shareholders of the sellers were investors in Adumo and the Company. These shareholders ultimately 1,989,162 shares of the Company’s common stock at a price of $ 4.79 which was included in redeemable common stock (refer to Note 14). The closing of the transaction was subject to customary closing conditions which we fulfilled prior to closing. The Company agreed to file a resale registration statement with the United States Securities and Exchange Commission (“SEC”) covering the resale of the Consideration Shares by the Sellers. The resale registration statement was declared effective by the SEC on December 6, 2024. The Company incurred transaction-related expenditures of $ 0.003 1.6 2.3 million during the years ended June 30, 2026, 2025 and 2024, respectively, related to the acquisition of Adumo. March 2025 acquisition of Utilities On November 19, 2024, the Company, through Lesaka SA, entered into a Sale of Shares Agreement (the “Utilities Purchase Agreement”) with Imtiaz Dhooma (Utilities’ former chief executive officer) and Ninety Nine Proprietary Limited (“the Seller”). Pursuant to the Utilities Purchase Agreement and subject to its terms and conditions, Lesaka, through its subsidiary, Lesaka SA, agreed to acquire, and the Seller agreed to sell, all of the outstanding equity interests in Lesaka Utilities Proprietary Limited, previously known as Recharger Proprietary Limited (“Utilities”). The transaction closed on March 3, 2025. At the same time, Utilities also entered into independent contractor agreement with Utilities’ former chief executive officer 12 months and required him, among other things, to support operational activities of the Utilities business, in consultation with Company representatives, facilitate the handover process and assist Utilities in transitioning ownership to Lesaka SA, avail himself for important customer and vendor meetings, attend scheduled weekly management committee meetings regarding operational and business activities of the Utilities business, and providing support on an ad-hoc basis to Company representatives with regard to operational matters and in facilitating the hand over, as and when reasonably required. This acquisition has been reported as part of the Company’s Enterprise operating segment and demonstrates positive advancement of the Company’s strategy in its Enterprise operating segment. The Company expects the acquisition to act as an entry point for it into the South African private utilities space while augmenting Enterprise’s alternative payment offering. The transaction consideration per the Utilities Purchase Agreement was ZAR 503.4 27.0 million) and comprised ZAR 328.4 17.6 175.0 9.4 million) in shares of the Company’s common stock, to be settled in two tranches. The share price applied to determine the number of shares of common stock to be issued for the equity consideration is based on the volume-weighted average price of the Company’s common shares for the three-month period prior to the disbursal of each tranche. Lesaka SA extended a ZAR 43.1 2.3 million) loan to Utilities at closing which was exclusively used to repay an existing loan due by Utilities to the Seller. The first tranche, comprising ZAR 153.4 8.2 1,092,361 shares of the Company’s common stock with a value of ZAR 98.3 5.3 million), was settled at closing. The value of the shares of common stock was calculated using the shares issued multiplied by the Company’s closing price on the Johannesburg Stock Exchange on March 3, 2025, of ZAR 90.00 , and translated to U.S. dollars at the exchange rate of $1: ZAR 18.63 1,092,361 shares of the Company’s common stock from a pool of shares it purchased in October 2024, and the Company recognized a gain in additional paid-in-capital during the year ended June 30, 2025, of $ 0.4 million related to the difference between in the value on March 3, 2025, and the price paid per share 3. ACQUISITIONS (continued) 2025 Acquisitions (continued) March 2025 acquisition of Utilities (continued) The second and final tranche was settled on March 3, 2026, and comprised a contractual cash payment of ZAR 175.0 ($ 10.4 million) and the delivery of shares of Lesaka’s common stock with a contractual value of ZAR 75.0 4.6 number of shares to be delivered was calculated as 1,017,914 shares of Lesaka’s common stock using the contractual value of ZAR 75.0 million divided by the volume-weighted average price of the Company’s common shares on the Johannesburg Stock Exchange for the three-month period prior to February 24, 2026. Lesaka SA delivered the 1,017,914 shares of the Company’s common stock from a pool of shares it purchased in October 2024, and the Company recognized a loss in additional paid-in-capital during the year ended June 30, 2026, of $ 0.1 million related to the difference between in the value on March 3, 2026, and the price paid per share in October 2024. The total purchase consideration was ZAR 294.8 15.8 million) and comprised the issuance of the 1,092,361 the Company’s common stock with a value of ZAR 98.3 5.3 million), the settlement of the pre-existing relationship shareholder loan of ZAR 43.1 2.3 153.4 8.2 ) million. Pursuant to the Utilities Purchase Agreement, payment of the second tranche in March 2026 was contingent on Utilities’ former chief executive officer’s ongoing service under the independent contractor agreement until June 30, 2025. The second tranche would not have been paid if he failed to provide the requisite service, except if failure to provide future services is due to expiry of the contract, mutual agreement or death of the former chief executive officer. The former chief executive officer was also a director of the Seller, and signed the Utilities Purchase Agreement on behalf of himself, Utilities and the Seller. He also signed an independent contractor agreement under which he is required to provide post-combination service to Utilities until March 2026 (but the vesting of the shares is only for services to June 30, 2025). The Company has determined that as the payment of the second tranche is contingent on these post-combination services, the value of the second tranche is not treated as purchase consideration and rather, under GAAP, represents compensation for post-combination services. In late May 2025, an addendum was signed to reduce the post-combination period from twelve months to four months (i.e. from March 2025 to June 2025). The post-combination services for the year ended June 30, 2025, of $ 13.6 million was calculated as the sum of the future cash payment and the value of future shares to be provided. The value of the future shares to be provided was calculated using the contractual value of ZAR 75.0 million divided by the volume-weighted average price of the Company’s common shares for the three-month period prior to June 30, 2025, and at the applicable exchange rate. The post-combination compensation charge is included in the caption transaction costs related to Adumo, Utilities and Bank Zero acquisitions and certain compensation costs included on the consolidated The Company records stock-based compensation charges that are cash-settled awards in other payables. The liability for the future payments was included in the caption Other payables in the consolidated balance sheet as of June 30, 2025, refer to Note 13. There was no unrecognized compensation costs related to the post-combination compensation charge as of June 30, 2025. The Company recorded a fair value loss of $ 0.4 million during the year ended June 30, 2026, related to the settlement of the 1,017,914 shares of Lesaka’s common stock under the caption change in fair value of equity securities in the consolidated statement of operations. The fair value loss was calculated as the difference between the fair value of the shares of common stock transferred on March 3, 2026, and the amount recorded in other payables as of June 30, 2025.The fair value of the shares of common stock in U.S. dollars on March 3, 2026, was calculated using the shares issued multiplied by the Company’s closing price on the Johannesburg Stock Exchange on March 3, 2026, of ZAR 75.37 , and translated to U.S. dollars at the exchange rate of $1: ZAR 16.35 . The Company incurred transaction-related expenditures of $ 0.01 0.4 0.03 during the years ended June 30, 2026, 2025 and 2024, respectively, related to the acquisition of Utilities. Other acquisitions Effective November 1, 2024, the Company, through its wholly owned subsidiary Lesaka Merchant Technologies Proprietary Limited, formerly known as Adumo Technologies Proprietary Limited, (“Lesaka MT”), acquired the remaining shares (representing 50 % of the issued and outstanding shares) it did not own in Lesaka Merchant Technologies Namibia, formerly known as Innervation Value Added Services Namibia Pty Ltd, (“Lesaka Nam”) for $ 0.4 6.0 million, translated at November 1, 2024 exchange rates). Lesaka Nam was accounted for using the equity method prior to the acquisition of a controlling interest in the company. Lesaka MT paid ZAR 2.0 million of the purchase price prior to the acquisition of Adumo by the Company and the balance of ZAR 4.0 two equal tranches, one in March 2025 and the other in September 2025. The Company did not incur any significant transaction costs related to this acquisition. 3. ACQUISITIONS (continued) 2025 Acquisitions (continued) Other acquisitions (continued) The Company, through Lesaka SA, acquired 100 % of Lesaka Digital Risk Proprietary Limited, formerly known as Genisus Risk Proprietary Limited (“Lesaka Digital Risk”), for a cash consideration of ZAR 2.0 0.1 million). The Company did not incur any significant transaction costs related to this acquisition. The Company, through its wholly owned subsidiary Lesaka Cash Management Proprietary Limited, formerly known as Cash Connect Management Solutions Proprietary Limited, (“LCM”), acquired 100 % of Lesaka Fuel Software Proprietary Limited, formerly known as Master Fuel Proprietary Limited (“Lesaka Fuel Software”) for a cash consideration of ZAR 2.0 0.1 Company did not incur any significant transaction costs related to this acquisition. The purchase price allocation for all acquisitions closed during the year ended June 30, 2025, were finalized as of June 30, 2025, except for Utilities. The Company completed the purchase price allocation related to the Utilities acquisition during the three months ended September 30, 2025. There were no changes to the Utilities preliminary purchase price allocation as of June 30, 2025. The purchase price allocation of acquisitions during the year ended June 30, 2025, translated at the foreign exchange rates applicable on the date of acquisition, is provided in the table below:
Acquisitions during fiscal 2025 Adumo Utilities Other Total Final Final Final Cash and cash equivalents $ 9,227 $ 1,720 $ 268 $ 11,215 Accounts receivable 6,799 17 728 7,544 5,122 194 3 5,319 Property, plant and equipment 9,170 39 28 9,237 Operating lease right of use asset 1,025 401 - 1,426 Equity-accounted investment 477 - - 477 Goodwill 71,992 3,614 508 76,114 Intangible assets 28,806 16,171 69 45,046 Deferred income taxes assets 1,061 81 55 1,197 Other long-term assets 2,809 - - 2,809 Current portion of long-term borrowings (1,178) - - (1,178) (3,266) (149) (440) (3,855) (28,116) (1,439) (252) (29,807) Operating lease liability - current (948) (185) - (1,133) (150) (4) (42) (196) Deferred income taxes liabilities (7,107) (4,366) (19) (11,492) Operating lease liability - long-term (326) (269) - (595) Long-term borrowings (7,308) - - (7,308) Other long-term liabilities (140) - - (140) 8,603 - - 8,603 (8,530) - - (8,530) Fair value of assets and liabilities on acquisition $ 88,022 $ 15,825 $ 906 $ 104,753 The fair value of the non-controlling interests recorded was $ 7.6 million. The fair value of the non-controlling interest was determined as the non-controlling interests respective portion of the equity value of the entity acquired by the Company, and which was adjusted for a 20 % minority discount. Pro forma results related to acquisitions Pro forma results of operations have not been presented for the acquisition of Lesaka Nam, Lesaka Digital Risk and Lesaka Fuel Software because the effect of these acquisitions, individually and in aggregate, are not material to the Company. Since the closing of these acquisitions, the entities have contributed revenue and net income of $ 0.8 0.1 million, respectively, for the year ended June 30, 2025. 3. ACQUISITIONS (continued) 2025 Acquisitions (continued) Pro forma results related to acquisitions (continued) The results of the Adumo and Utilities’ operations are reflected in the Company’s financial statements from October 1, 2024, and March 3, 2025, respectively. The following unaudited pro forma revenue and net income information has been prepared as if the acquisitions of Adumo and Utilities had occurred on July 1, 2023, using the applicable average foreign exchange rates for the periods presented:
2025 2024 Revenue $ 673,536 $ 630,672 Net loss $ (68,367) $ (37,324) The unaudited pro forma financial information presented above includes the business combination accounting and other effects from the acquisitions including (1) amortization expense related to acquired intangibles and the related deferred tax; (2) the loss of interest income, net of taxation, as a result of funding a portion of the purchase price in cash; (3) an adjustment to exclude all applicable transaction-related costs recognized in the Company’s consolidated statement of operations for year ended June 30, 2025, and include the applicable transaction-related costs for the year ended June 30, 2024; an adjustment to exclude the post-combination compensation expenses related to the Utilities acquisition recognized in the Company’s consolidated statement of operations for year ended June 30, 2025, and include the expense during the year ended June 30, 2024. The unaudited pro forma net income presented above does not include any cost savings or other synergies that may result from the acquisition. The unaudited pro forma information as presented above is for information purposes only and is not indicative of the results of operations that would have been achieved if the acquisition had occurred on these dates. Since the closing of the acquisitions, Adumo and Utilities have contributed aggregate revenue of $ 48.6 attributable to the Company, including intangible assets amortization related to assets acquired, net of deferred taxes, and the post- combination compensation charge, of $ 16.4 2024 Acquisitions April 2024 acquisition of Insights In April 2024 the Company closed the acquisition of Lesaka Insights Proprietary Limited, formerly known as Touchsides Proprietary Limited, (“Insights”). Insight s has been allocated to our Merchant operating segment. The final purchase price allocation of the Insights acquisition, translated at the foreign exchange rates applicable on the date of acquisition, is provided in the table below:
Insights Cash and cash equivalents $ 665 Accounts receivable 788 Property, plant and equipment 1,106 Operating lease right of use asset 112 Intangible assets 33 (53) (279) Operating lease liability – current (63) Deferred income taxes liabilities (9) Operating lease liability - long-term (52) Fair value of assets and liabilities on acquisition $ 2,248 Pro forma results of operations have not been presented because the effect of the Insights acquisition is not material to the Company. During the year ended June 30, 2024, the Company incurred acquisition-related expenditure of $ 0.1 acquisition. Since the closing of the Insights acquisition, it contributed revenue and net loss of $ 0.9 0.2 r espectively, for the year ended June 30, 2024. 3. ACQUISITIONS AND DISPOSITIONS (continued) Transaction costs and certain compensation costs The Company did no t incur any transaction costs related to the Bank Zero acquisitions during the year ended June 30, 2024. The table below presents transaction costs incurred related to the acquisition of Adumo and Utilities, and the proposed acquisition of Bank Zero, as well as certain post-combination compensation costs expensed during the years ended June 30, 2026, 2025 and 2024:
2026 2025 2024 Bank Zero transaction costs $ 374 $ 599 $ - Utilities transaction costs 12 410 32 Adumo transaction costs 3 1,564 2,293 389 2,573 2,325 Utilities post-combination services expensed - 13,586 - Total $ 389 $ 16,159 $ 2,325 Dispositions December 2025 disposal of Humble On December 1, 2025, Adumo (RF) Proprietary Limited, a wholly -owned subsidiary of the Company, disposed of its entire investment in Humble Software Proprietary Limited (“Humble”) and received 306,767 shares of the Company’s common stock as consideration. The fair value of these 306,767 shares of the Company’s common stock on December 1, 2025, was $ 1.2 shares have been included in the Company’s treasury shares. The table below presents the impact of the deconsolidation of Humble and the calculation of the net loss recognized on deconsolidation:
Deconsolidation of Humble Humble Fair value of consideration received $ 1,211 Add carrying value of non-controlling interest on deconsolidation 47 Less: carrying value of Humble, comprising 1,988 Cash and cash equivalents 162 26 10 Property, plant and equipment, net 1 Goodwill 1,515 63 Deferred income taxes assets 300 (4) (58) (1) Released from accumulated other comprehensive income – foreign currency translation reserve (26) Loss recognized on disposal, before transaction costs (730) Loss recognized on disposal, before tax (730) Taxes related to gain recognized on disposal - Tax benefit related to loss recognized on disposal (1) - Release of valuation allowance (1) - Loss recognized on disposal, after tax $ (730) (1)The Company incurred a capital loss of $ 0.04 million. The Company recorded a valuation allowance of $ 0.04 to the capital loss generated. |