'Big interest' in the South African business owned by disgraced German firm Wirecard
- The South African business owned by disgraced German fintech group Wirecard is for sale.
- Once one of Germany's 30 biggest companies, Wirecard collapsed after a R37 billion black hole was discovered in its accounts.
- There has apparently been “substantial expressions of interest” in its local unit.
- For more stories go to Business Insider South Africa.
The South African business owned by disgraced German fintech group Wirecard is on the market and has already received “substantial expressions of interest”.
The 20-year old Wirecard, once one of Germany’s 30 biggest companies, provided payment solutions for thousands of firms including Allianz, FedEx, Qatar Airways and KLM.
But in June, its auditor EY refused to sign off on its results: it wanted better evidence that €1.9 billion (R37 billion) on the firm's balance sheet really existed. Wirecard claimed that the money was held in two bank accounts in the Philippines, but the banks denied that, and the governor of the country's central bank said documents provided to EY appeared to be forged, Business Insider previously reported.
The company then filed for insolvency and its CEO Markus Braun was arrested by German police in Munich on suspicion of market manipulation and false data.
The administrators of Wirecard are now selling its subsidiaries across the world, including in South Africa.
The German firm bought 100% of Cape Town-based MyGate Communications, a payment solutions provider, for €23 million (R440 million, at the current exchange rate) in 2017. The company was rebranded Wirecard Solutions South Africa, and had big plans for aggressive growth on the continent.
In 2017, it launched SecureEFT in the local market, which allows customers to make secure online payments directly into a bank account and get notified in real-time. Merchants who receive payments from consumers via electronic funds transfer (EFT) could get instant notification of successful settlements.
Hannalie Marsh, regional managing director of Wirecard in Sub-Saharan Africa, told Business Insider SA that the local business remains “operationally unaffected” by the company’s crisis in Germany. “We are providing services to our customers business as usual.”
The company has been put up for sale, and the process is being managed by an administrator in Germany.
“We have already received substantial expressions of interest and we are confident that the process will kick off soon,” Marsh said.
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