M&AJul 22, 2026, 07:14 UTC

Pepkor to buy 57.1% of R21.3B fintech platform in Flash-Shop2Shop merger

What's the deal? Pepkor will acquire a controlling 57.1% interest in a new South African fintech platform formed by combining its Flash business with Shop2Shop. The company will pay R1.57 billion in cash for new Shop2Shop shares and contribute 100% of Flash, valued at R10.6 billion, giving the combined entity — dubbed FintechCo — an implied equity valuation of roughly R21.3 billion.

What each side brings: Flash is a value-added services distribution network and digital products platform. Shop2Shop is a merchant-focused platform offering acquiring, payments, cash management, and trade services. Together they will handle annual throughput value exceeding R200 billion.

Why now? South Africa's informal market is a fast-growing part of the economy, driven by resilient consumer demand and rising merchant participation. The deal builds on a long-standing commercial relationship between the two firms.

What's the endgame? Pepkor wants to build an integrated fintech ecosystem covering cash handling, acquiring, payments, and related services across the informal market. The combined platform will support its retail-powered consumer base of 32 million known customers, with a future listing planned to unlock shareholder value.

The signal: The tie-up reflects a push to formalise and digitise commerce for cash-based merchants without cutting off cash transactions. "Shop2Shop was founded to bring purpose-built solutions to South Africa's large and underserved informal merchant market, to empower small business owners," said founder Peter Berry. As Pepkor accelerates its Informal Market Platform segment, the deal positions FintechCo as one of the country's larger merchant commerce and fintech players.