Acquiring Konga And Unity bank Plc Will Reposition Interswitch [Video]

Acquiring Konga And Unity bank Plc Will Reposition Interswitch [Video]

This is a videocast supporting our proposal for Interswitch to buy Konga and Unity Bank in order to deepen its competitiveness through a well differentiated platform.

Interswitch has been heralded as a future unicorn, a private technology company with valuation of at least $1 billion, by TechCrunch. Then, it was expected that Interswitch would go public in the Nigerian Stock Exchange and London Stock Exchange, in 2016. That exit, through IPO, did not happen and it would be assumed that Helios was disappointed.

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We propose for Interswitch to buy a bank and Konga. Together, both will provide growth drivers which will be catalytic. Public traded Unity Bank is worth about $31 million according to Bloomberg Markets. Interswitch could pay a premium and acquire it for $40 million;  Konga is worth about $34 million.

 

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4 thoughts on “Acquiring Konga And Unity bank Plc Will Reposition Interswitch [Video]

  1. Acquiring a Bank will put Interswitch at a disadvantage in my opinion. Interswitch presently plays multiple platform provider and Fintech roles providing interoperability for Financial institutions and other Fintechs. The acquisition of a Bank will position Interswitch as a direct competition to the Bank’s it serves and earn’s from today. The Bank’s may react by cutting off from it’s services making Interswitch lose it’s high market share as a payment service/ platform provider.

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    1. I equally believe so. Competing with me and rendering interconnectivity services which could be provided by another support player?…I’ll go to the other player and this makes the product delivery vast with seeming competition.

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  2. That is indeed a good point except that most of the banks are increasingly using alternatives. The reality is that switching and what Interswitch cannot protect it from these banks, and it cannot rely on them for growth, because as the market opens, they will look for alternatives. Had Interswitch be pan-African, this risk will be minimal. We do not see how a bank that operates in say 10 African countries using different solution providers on what Interswitch offers cannot consolidate to save cost as more players emerge.

    Having a bank license can help this firm to pioneer a truly Internet-only banking since it understands digital. It pays it to disrupt itself from internal than to be made irrelevant in near future.

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