Fin24

Net1 co-operating with US tender probe

2012-12-05 10:44

Johannesburg - Net1 UEPS Technologies [JSE:NT1] said on Wednesday it was co-operating fully with US authorities in their investigation of a controversial R10bn tender awarded to it by the South African government earlier this year.

In January‚ Net1 announced its subsidiary‚ Cash Paymaster Services (CPS)‚ was awarded a tender by South African Social Security Agency to distribute social grants of R500bn to more than 15-million recipients over a five-year period.

Absa subsidiary AllPay challenged the decision‚ alleging widespread corruption and irregularities in the tender process.

But Net1‚ which is listed on the Nasdaq exchange in the US and on the JSE‚ said on Wednesday: “As a preliminary matter‚ the company believes that it is important to note that these investigations are investigations and not findings of wrongdoing on the part of any person and that Net1 is fully co-operating with the investigations.”

The company said the US investigations appeared to be directed at matters that were similar to those raised by AllPay to set aside the contract.

Shares in Net1 slid more than 50% on the JSE on Wednesday‚ but in thin volumes.

At 9:53am‚ the counter was down 55.29% at R30‚ valuing the company at R1.751bn.