Experian to buy South Africa's Compuscan
By Michele Maatouk
Date: Monday 10 Dec 2018
(Sharecast News) - FTSE 100 credit checking firm Experian has agreed to buy South African credit bureau and information services business, Compuscan, for ZAR3.72bn, or around $263m, in a deal that will be funded from existing cash resources.
Founded in 1994, Compuscan is one of the leading providers of credit information and decision analytics in South Africa, with operations across seven key geographies in Sub-Saharan Africa. It also provides marketing services and recently launched a free credit report service for consumers.
Experian said that by combining the two companies, it will enhance the services it can provide to its B2B customers and consumers, and deliver substantial" operational synergies. In addition to deepening its bureau data assets, Compuscan has particular strength in analytics and scores, which Experian said was "highly complementary" to its strength in decisioning software.
Experian chief executive Brian Cassin said: "We are delighted to announce that Experian has agreed to acquire Compuscan. We have a long track record of investment in South Africa, where for many years we have helped businesses thrive through the provision of credit data and decisioning tools. Millions of people across Africa need access to financial services. By combining forces with Compuscan, we will be better positioned to serve the people and businesses of this region and be an enabler of growth in consumer and business credit, identity management and financial inclusion.
"This is an important transaction for our business in South Africa and will provide opportunities more broadly across the African continent. We look forward to welcoming the Compuscan team to Experian."
For the year to the end of December 2018, Compuscan is expected to generate ZAR489m ($35m) in revenue, growing to ZAR532m ($38m) in the year ending 31 December 2019. This compares to Experian revenues in South Africa of around $40m.
Experian said the deal - which is expected to complete during the first quarter of the financial year ending 31 March 2020 - should be accretive to benchmark earnings per share in its first full year of ownership.
At 1355 GMT, the shares were up 0.2% to 1,867p.
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