Kaspi Pay, a 100% subsidiary of Kazakhstan’s Kaspi.kz JSC, has signed a sale and purchase agreement for 100% of Portmone Group, an independent provider of payment and money transfer services in Ukraine, which is majority owned by Europe Virgin Fund (EVF).
“The acquisition of Portmone puts our Payments Platform in a strong position to end into Ukraine,” according to Kaspi’s semi-annual report on the London Stock Exchange.
According to the report, subject to anti-monopoly approval in Ukraine and Kazakhstan and approval by the National Bank of Ukraine, this transaction is expected to complete in the final quarter of 2021. The report said that upon successful closing the acquisition of Portmone also gives Kaspi.kz a payments license and Visa and Mastercard accreditation in Ukraine. In the medium-term, Ukraine can also become an important source of IT talent and a development hub for Kaspi.kz.
It is noted that Ukraine is characterized by high cash penetration (44% cash withdrawals), low e-commerce penetration at 8% of retail, low unsecured consumer lending at less than 4.5% of GDP and over 70% smartphone penetration.
Oleh Gorokhovskyi, the co-founder of virtual monobank serving over 3 million clients, predicted on Facebook that the new owner of Portmone would increase competition in the market.
“Kaspi is a global fintech star. The company’s valuation has doubled since the recent IPO and is already $13 billion. I love strong competitors. They are very motivating and mobilize the team,” Gorokhovskyi said.
At the same time, he doubted Kaspi’s ability to gain leadership in the Ukrainian market.
“In payments, they will have to compete with completely free payments from mono. In acquiring, in which they are strong in Kazakhstan, they will have to learn all the charms of government interference with the regulation of this market and compete not only with us and Privat, but also with Apple and Google Pay. Even in Kazakhstan, they got a marketplace – in Ukraine, this will also be difficult,” the co-founder of monobank said.
EVF, a regional private equity fund organized by Dragon Capital in 2010, acquired a majority stake in Portmone. The fund’s participants were Dragon Capital, EBRD, the Swiss sovereign wealth fund Obviam, the Black Sea Trade and Development Bank and other investors.
Kaspi.kz operates on three platforms – marketplace, fintech platform and payment system. The company’s shareholders are Baring Vostok funds – 28.82%, Vyacheslav Kim – 23.25%, and Mikhail Lomtadze – 22.44%.
