Pepkor to Acquire Controlling Stake in Combined Flash and Shop2Shop Fintech Business

Pepkor to Acquire Controlling Stake in Combined Flash and Shop2Shop Fintech Business. Pepkor has announced a proposed transaction to combine its fintech subsidiary, Flash, with payments platform Shop2Shop, creating a merchant commerce and financial technology business focused on serving South Africa’s informal retail sector.

Under the proposed deal, Pepkor will acquire a controlling 57.1% stake in the newly combined business, referred to as FintechCo. The company said the transaction values the combined entity at approximately R21.3 billion, with annual transaction throughput expected to exceed R200 billion.

The transaction brings together two businesses that provide services to informal retailers. Shop2Shop offers payment infrastructure and cash-handling services, while Flash provides value-added services, digital products and payment solutions.

According to Pepkor, the combined platform will offer merchants a broader range of services, including cash handling, payments, digital services and financial products through a single ecosystem.

The company said the transaction forms part of its strategy to expand beyond traditional retail by growing its presence in financial services and digital commerce.

Shop2Shop founder and chief executive Peter Berry said the merger would strengthen the company’s ability to serve small businesses operating in South Africa’s informal economy. He said combining the two businesses would allow the platform to broaden its offering while increasing its scale.

Pepkor Chief Commercial Officer Garth Napier described the proposed transaction as an important step in expanding the group’s participation across the informal market value chain and extending its financial services ecosystem.

The company said it will secure its majority stake through a combination of a R1.57 billion cash subscription for newly issued Shop2Shop shares and the transfer of 100% of Flash into the combined business. Flash has been valued at R10.6 billion for the purposes of the transaction.

Pepkor added that the proposed deal also creates the possibility of a future stock market listing for FintechCo.

The transaction remains subject to a number of conditions, including approval from South Africa’s competition authorities and other relevant regulators.