SANLAM Private Equity (SPE) said yesterday that it had acquired a controlling interest in payment solutions provider Q LINK Holdings.
SPE agreed to acquire the shares from Apis Partners, a UK based private equity fund; Multiply Group, a local private investment firm, and other minority shareholders, however, the value of the deal was not disclosed.
SPE made the acquisition through its new third-party private equity fund, SPE Mid-Market Fund, one of three impact-focused funds in the Sanlam Investor Legacy Range launched in 2020 to create and preserve 27 000 jobs while still delivering value for investors.
The Q LINK acquisition follows that of the Cavalier Group and Absolute Pets.
Q LINK provides payment application software that manages deductions in both the payroll and bank collection streams.
Currently, the company facilitates collections for more than 30 percent of all recurring retail life insurance premiums in the country. The company services more than 4.5 million employees, collecting R4.5 billion in monthly premiums for over 133 clients, many in the insurance industry.
“The deal is expected to grow direct jobs by around 28 percent over the next few years, driving SPE’s commitment to economic recovery and growth,” it said.
PE managing partner, Paul Moeketsi, says his team has long monitored the financial technology sector. “We are seeing the significant social impact, especially around financial inclusion and improving the lives of previously disadvantaged communities through the provision of financial access and high growth, and good return prospects from this sector. We are therefore very excited to acquire Q LINK as our first investment in the space.”
He said Q LINK had a robust business model.
“Together with the management team, we will identify and unlock new growth opportunities while providing access to our capital, commercial expertise in investing and attractive Black Economic Empowerment credentials,” he said.
Moeketsi said, “Overall, youth accounts for 39 percent of employees and, over the investment period, Q LINK intends to grow direct jobs by 28 percent. This will be done through the rollout of the new Moneyhub service, a consolidated collection and disbursement platform, integrating payroll, debit order and early debit order (EDO) deductions in line with the new mandate authentication process, DebiCheck.”
In addition, according to the National Treasury domestic output multiplier for finance and business services sectors and the company’s projected revenues, Q LINK is expected to contribute an additional 757 indirect jobs within the wider economy.
Q LINK founder and chairperson Henry Smith, said: “We are looking forward to working with a new strategic partner in SPE as we enter the next growth phase of our business. In addition, we are delighted to align with a commercial investor who understands the importance of Q LINK’s continued independence as a strategic payment collections partner for several insurance companies in South Africa.”