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Cash Connect bolstered by acquisition

South African supplier of integrated cash solutions, Cash Connect Management Solutions has announced the successful acquisition of the group. The sale of the business was facilitated by Nedbank Capital. The acquisition was keenly contested with numerous trade buyers submitting bids.

The business has been acquired by a consortium of Old Mutual’s specialist investment fund, Future Growth Asset Management together with Ivan Epstein, founder of Softline and Steven Heilbron (formerly of Investec).

This is a significant development in an industry which has seen a series of transactions involving cash in transit providers targeting device and cash management suppliers in an attempt to gain cash processing dominance.

Epstein, who will assume the role of non-executive chairman, comments that the acquisition has significantly bolstered the balance sheet of Cash Connect.

Cash Connect Management Solutions was founded by cash security and logistics doyen Richard Phillips in May 2006. The company has played a leading role in cash protection and supplying tailor-made, end-to-end cash handling solutions that incorporates management access to real-time information, financial reporting systems and cash vaults manufactured to meet strict SABS Category 4 standards.

Cash Connect’s business model makes a bold statement in that it assumes the risk of its clients’ cash from the instant it is deposited into a Cash Connect vault, underwriting the tagline, 'We take the risk'.

Cash Connect currently services many of the premier retailing brands in South Africa and has been successful in protecting assets, deflecting armed attacks and significantly reducing in store cash shrinkage. The Cash Connect offering has resulted in many retailers enjoying the benefits of reduced risk, time savings and cost reductions. The resources injected by the new shareholders will support both growth and innovation.

“We intend to increase the footprint of our core product which is accepted as being a market leader by our customer base and leading retail security experts. Technology upgrades will continue to enhance this differentiation through increased functionality. Cash Connect is well positioned to expand its activities in cash acquiring and dispensing, closed loop and mobile payment solutions,” says Heilbron, who assumes the role of CEO.

In early 2010, in response to growing market concerns – particularly in the retail industry – about the security of customer cash whilst in the care of other cash solutions providers, Cash Connect launched a security structure. Designed to protect cash from the time it is deposited into the safe until the value is received in the bank account. This structure removes the risk to which retailers are characteristically exposed. Furthermore, the cornerstone of the solution is the fact that Cash Connect vaults have become known as an extremely effective deterrent to hit and run armed attacks that increasingly threaten the South African retailer.

“Cash Connect currently enjoys one of the most successful risk profiles in the industry,” says joint CEO Richard Phillips.

Epstein is interested in the regional expansion of Cash Connect and states further that “the Cash Connect, business model could compete favourably beyond the borders of South Africa”.

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