UAE: Arcapita And Dgpays Consortium Acquires Majority Stake In Mashreq's NEOPAY

Arcapita and Dgpays, in collaboration with Mashreq, have entered into a landmark agreement to acquire a majority share in NEOPAY. This move not only marks a pivotal moment for NEOPAY but also signals the Consortium's confidence in the future growth of digital payment solutions in the region. With an enterprise value pegged at approximately $385 million, the deal awaits green light from regulatory bodies.

NEOPAY, originally a strategic unit within Mashreq, has witnessed substantial growth, serving sectors like retail and e-commerce robustly. This growth trajectory is set against the backdrop of the UAE's thriving economy, marked by a young, tech-savvy population and significant digital transformation initiatives led by the government. The aim is to foster a cashless society, further providing a fertile ground for NEOPAY to expand its services.

With the UAE's card transaction volumes expected to surge at a double-digit rate in the coming years, NEOPAY stands to significantly increase its market share. This acquisition by Arcapita and Dgpays, with Mashreq maintaining a considerable minority stake, is poised to catapult NEOPAY into new heights of growth and innovation. Leveraging Dgpays' advanced technology, NEOPAY is expected to introduce a slew of new services, enhancing its offerings in the ever-evolving digital payments landscape.

Serkan Omerbeyoglu, CEO of Dgpays, expressed enthusiasm for this strategic partnership, recognizing NEOPAY's remarkable progress and innovation within the UAE's digital payment sphere. He highlighted the goal of expanding NEOPAY's success throughout the Middle East, leveraging Dgpays' technology and strategic partnerships to drive growth and innovation.

"We are excited to support NEOPAY's transformative journey in partnership with Mashreq. NEOPAY has demonstrated exceptional growth and innovation in the UAE's digital payments landscape, and we see tremendous potential in expanding this success across the broader Middle East region," Omerbeyoglu stated.

Atif A. Abdulmalik, CEO of Arcapita, mirrored this sentiment, pointing out NEOPAY's alignment with Arcapita's strategic investment goals. He noted the company's market leadership and growth potential, bolstered by the UAE's shift towards digital payments and supportive macroeconomic trends. "NEOPAY is fully aligned with Arcapita's investment strategy which focuses on acquiring companies that are not only market leaders but also have strong growth potential driven by favorable macroeconomic trends," Abdulmalik remarked.

Ahmed Abdelaal, Group CEO of Mashreq, and Vibhor Mundhada, CEO of NEOPAY, both underscored the significance of this transaction. Abdelaal highlighted the transaction as a milestone in NEOPAY's journey towards becoming a digital payments leader in the region, while Mundhada expressed excitement for the support of Arcapita and Dgpays in accelerating NEOPAY's growth.

"This transaction is a key milestone in NEOPAY's journey, allowing it to continue its strong growth trajectory as a regional leader in digital payments," said Abdelaal. Mundhada added, "We are thrilled to embark on the next chapter of NEOPAY's growth with the support of Arcapita and Dgpays."

To facilitate this transaction, Goldman Sachs International, DIFC Branch offered financial advisory services to the seller. In contrast, deNovo Partners guided the Consortium. Legal expertise was provided by Clifford Chance to Mashreq and Freshfields to the Consortium, ensuring a smooth and compliant acquisition process.