Capital Appreciation On An Acquisition Spree In SA, Netherlands

Capital Appreciation
Brad Sacks Joint Chief Excecutive Capital Appreciation

South African FinTech group Capital Appreciation Limited (Capprec) is on an acquisition spree in South Africa and the Netherlands.

Capprec announced today it has acquired Responsive Technology group for the purchase price of c.R48,68 million.

Capprec is a financial technology company with proprietary and licensed platforms, solutions, products and applications targeted at the B2B market.

Its client base includes all major banking institutions in South Africa, as well as many niche banks, large financial services institutions and other financial services companies. In recent times, the company has also successfully diversified into the Retail, Telecoms and Healthcare sectors.

The acquisitions include three South African companies: Responsive Tech Proprietary Limited (100%), Responsive Digital Proprietary Limited (100%), and Rethink Digital Solutions Proprietary Limited (71%).

Responsive Tech is a digital solutions group that designs and develops digital applications with clients across South Africa, the USA, Europe and the United Kingdom.

The group has a proven, 10-year track record of delivering complex digital transformation projects, web and mobile apps, as well as technology products for leading South African and international blue-chip clients. These companies have included Brambles Limited (CHEP), Capitec, Coronation, Experian, MoneyGram, Nedbank and Old Mutual.

The group is passionate about creating user-centric experiences and utilising best-of-breed technology to expertly develop and launch digital applications.

As digital product specialists, Responsive assists its clients in developing fast, secure and scalable applications in the cloud, that get to market quicker, drive results and unlock business value. Its unique approach has led to the group becoming a preferred supplier amongst financial institutions and has made it a natural fit for the Capital Appreciation Group.

As part of the transaction, Capprec will subscribe for 20% of the issued shares in Regal Digital B.V., a related party technology company located in the Netherlands, for a cash investment of Euro 500,000 (c. R8,5 million).

Regal Digital is the operating company of Firelava, a consulting services business focusing on Web 3.0 technologies, non-fungible token (NFT) and Blockchain solutions, Google Firebase and cloud specialist services as well as solution architecture consultation.

Regal Digital has an 80% shareholding in Flamelink B.V., a ‘software-as-a-service’ (SaaS) solution offering a headless Content Management System (CMS) for Google’s Firebase and is currently the de facto Firebase CMS with the most feature-rich offering in the market.

Capprec Joint CEO, Bradley Sacks, noted that: “Responsive fits well with Capital Appreciation’s investment philosophy of investing in established, asset-light growth companies that deliver innovative and disruptive FinTech solutions to mainly institutional clients. We also look forward to exploring the potential for synergistic opportunities with existing operating units.”

Founded in 2011, Responsive is a team of technical experts and innovative problem solvers, leveraging design thinking to put customers at the centre and using best-of-breed technology to expertly build and launch digital applications.

The Responsive founders and directors (Andrew McElroy, Marsh Middleton and Brandon Fairweather) stated: “We are excited to join a group that has such a strong culture of innovation, an extensive client base and a healthy balance sheet from which to expand. We look forward to adding our unique strength to the group to create the best experiences for existing and new clients. We also see synergies in creating web and mobile products that delight users by following a design thinking approach and expertly implementing the best technology solutions.”

 The Responsive Group will form part of Capprec’s Software division and report through to Synthesis.

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