Johannesburg - Net 1 Applied Technology Holdings (Aplitec), which teamed up last November with Kopano ke Matla Investments, Cosatu's investment arm, to launch Prosperity Holdings, a financial services company, would probably not proceed with a number of plans announced in a blaze of publicity last November, the company said recently.
JSE-listed Aplitec, which set itself up as a provider of smart-card-based payment systems, was instead restructuring itself to become a broader-based financial services group while still accommodating Kopano.
Bradley Sacks, the chief executive of Prosperity, had originally intended to raise R400 million by listing his company on the JSE's Development Stage sector by the end of last year or early this year.
Prosperity was to have made a share swap offer for the whole of Aplitec at R6,50 a share. It would then have bought Kopano's 50 percent interest in Prosperity Insurance, South Africa's first truly black insurer, from which the new group took its name.
Tumelo Motsisi, Kopano's chief executive officer, said last November that Prosperity had applied for a banking licence to create Prosperity Bank as a platform for banking the country's unbanked.
Sacks said in November that Kopano would hold more than 30 percent of Prosperity.
However, Serge Belamant, the chief executive officer of Aplitec, said recently that a series of changes of plan and new initiatives had culminated in the decision not to list Prosperity and to drop the application for a banking licence. Aplitec would instead be used as the main vehicle for the transactions announced last year.
The changes of plan Belamant referred to had not been made public, but he said: "The deal is still on, but it's more likely to happen through Aplitec. It's not a compromise, it's not a fudge, it makes sense."
Aplitec still intended to use Prosperity to facilitate free banking and financial services delivery for the mass market, but not exclusively with Prosperity Insurance.
"The listing of Prosperity could not take place last year because it was looking at a number of transactions," said Belamant.
"Between November and February, everything was planned to go, then CPS (Cash Paymaster Services) came along, and we didn't want to miss the opportunity just because Prosperity wasn't listed, so Aplitec bought it."
CPS, previously owned by First National Bank, distributes monthly social grant payments in South Africa and Namibia.
"We're still putting the structure of the Prosperity deal together, and now Aplitec's doing well, we've got in a few merchant banks to see how we can structure things without having to list Prosperity," said Belamant.
"In my mind, it's really a restructuring of Aplitec to accommodate Kopano and other black empowerment people. Aplitec becomes Prosperity Holdings and Kopano can be a much larger shareholder in a
re-engineered Aplitec."
Kopano's stake in the enlarged Aplitec business would reflect what it brought to Aplitec, but was unlikely to exceed 20 percent, said Belamant.
"Kopano could decide to move Prosperity Insurance to Aplitec, but I'd prefer them to keep it under the Kopano umbrella and use the Aplitec platform. We'll be providing technology to them to fulfil their aspirations, be that as Kopano Insurance or Kopano Bank."
Prosperity had shied away from obtaining a banking licence when it realised the licence would lead to total initial capital requirements of R150 million and that it could easily piggyback on other banks' licences to fulfil its banking aspirations.
Belamant said the Banking Council had recommended the registrar of banks change the rules as they related to Aplitec's business and provide for a "mini banking licence".