Financial Software sets aside Rs.150 cr for buys in Africa

The Chennai-based Financial Software & Systems is planning a Rs.150-crore acquisition to give it access to the African markets, according to Nagaraj V Mylandla, Founder and Managing Director, FSS.

FSS is keen on the business opportunities in Africa particularly South Africa, Zimbabwe and Kenya. For this, it plans to acquire a company in the region to help in getting customers and geographical reach.

“We will invest around ₹150 crore in the acquisition in a company that has a strong presence in Africa and close the deal in the next 12 months,” Mylandla said.

There is a lot of development taking place in Africa with both World Bank and the International Monetary Fund investing a lot of money in the region’s development. The region, especially South Africa, has leapfrogged on to mobile payments in which FSS has a lot of competency, he told newspersons.

Stock market

The company plans to tap the stock market in two years to raise Rs.1,000-1,200 crore. This is to fund the next phase of growth and provide an exit route for some of the existing investors.

The payments technology and transactions processing provider in which Wipro chairman Azim Premji has invested last December has been valued at around ₹2,200 crore. Jacob Ballas Capital India Pvt Ltd, New Enterprise Associates, Inc and Premji Invest, the investment office of Premji, collectively hold nearly 40 per cent stake in the FSS, and the rest held by promoters and employees, Mylandla told newspersons.

FSS closed the financial year ended March 31, 2015, with a revenue of over ₹600 crore and plans to double the revenue in the next two years. It invested nearly ₹600 crore in the last three years on various payment solutions. It offers its products, solutions and services across the entire payment eco-system, including ATM deployment and managed services, internet and mobile payment, micro banking and cash management system for debit, prepaid and smart cards.

Mylandla said the company has over 100 clients with State Bank of India being the anchor client contributing nearly 15 per cent of the revenue.

The company is close to signing a deal with another major bank for end-to-end payment solution. Detailed information on the deal will be provided in a few days, he said.