Arcapita Group Holdings Limited (Arcapita), a global alternative investment firm, and Dgpays, a prominent financial infrastructure technology provider in the EMEA region, have formed a Consortium to enter into a partnership with Mashreq, one of the UAE’s foremost financial institutions. Together, they have announced their agreement to acquire a majority stake in NEOPAY, the UAE’s rapidly growing payment solutions provider, while Mashreq will maintain a substantial minority interest. In addition, this transaction values NEOPAY at approximately $385 million, pending necessary regulatory approvals.
Strategic growth opportunities
This acquisition further marks a pivotal moment for NEOPAY as it seeks to enhance its footprint in the fast-evolving digital payments landscape in the Middle East. Also, with the Consortium’s strategic backing, NEOPAY is positioned to accelerate its growth and introduce new services by leveraging Dgpays’ innovative technology.
Market position and potential
As the UAE’s fastest-growing payment solutions provider, NEOPAY has established a solid presence among merchants and e-commerce businesses. Additionally, the card transaction value in the UAE is projected to grow at double-digit rates over the next five years, offering NEOPAY significant opportunities to expand its market share.
Shared vision for innovation
Initially launched as a strategic division within Mashreq, NEOPAY has witnessed substantial growth in recent years, catering to a diverse range of clients across sectors such as retail, hospitality, government, and e-commerce. Moreover, its expansion is fueled by the UAE’s vibrant economic environment, characterized by a young, digitally savvy population, strong GDP growth, and government initiatives aimed at fostering digital transformation and a cashless economy.
Key milestone
Ahmed Abdelaal, group CEO, Mashreq, expressed: “This transaction is a key milestone in NEOPAY’s journey, allowing it to continue its strong growth trajectory as a regional leader in digital payments. We are confident that Arcapita and Dgpays have the right expertise and vision to help NEOPAY achieve its ambitious expansion plans across the Middle East. While Mashreq retains a significant stake in NEOPAY, we are excited to see the company reach new heights as it scales its operations and reinforces its market leadership.”
Value-added services
Atif A. Abdulmalik, CEO of Arcapita, commented: “NEOPAY is fully aligned with Arcapita’s investment strategy which focuses on acquiring companies that are not only market leaders but also have strong growth potential driven by favorable macroeconomic trends. NEOPAY is well-positioned to benefit from the UAE’s ongoing shift towards digital payments, supported by rising GDP, a tech-savvy young population, and government-led initiatives for digital transformation.”
He further said, “Arcapita will support the next phase of NEOPAY’s growth into value-added services and new markets.”
Driving digital adoption
Vibhor Mundhada, CEO of NEOPAY, said, “We are thrilled to embark on the next chapter of NEOPAY’s growth with the support of Arcapita and Dgpays. NEOPAY has established itself as a leader in the digital payments sector by consistently innovating and delivering value to our clients. With the technological and financial backing of our new shareholders, alongside Mashreq’s continued support, we are well-positioned to accelerate our growth in the UAE and expand our footprint across the Middle East.”
“We remain committed to advancing e-commerce payments and driving the broader adoption of digital payments across the region”, he further added.
Innovative solutions for SMEs
For his part, Serkan Omerbeyoglu, CEO of Dgpays, noted, “We are excited to support NEOPAY’s transformative journey in partnership with Mashreq. NEOPAY has demonstrated exceptional growth and innovation in the UAE’s digital payments landscape, and we see tremendous potential in expanding this success across the broader Middle East region. At Dgpays, our mission has always been to drive digital transformation in financial services through cutting-edge technology and strategic partnerships.”
Additionally, he said, “By integrating our fintech solutions with NEOPAY’s robust platform, we aim to unlock new opportunities for growth and innovation and present these innovative solutions to the enterprise and SME market of the UAE and broader GCC market.”
Moreover, this acquisition reflects a strategic alignment among Arcapita, Dgpays, and Mashreq, underscoring their shared dedication to advancing innovation and growth within the digital payments sector across the Middle East.
Read more: Dubai’s Mashreq leads $3.25 billion sustainability-linked financing for GEMS Education
Advisory and legal support
Goldman Sachs International, DIFC Branch served as the financial advisor to the seller, while deNovo Partners provided advisory services to the Consortium. Furthermore, Clifford Chance acted as legal counsel for Mashreq, and Freshfields represented the Consortium. Mashreq’s Investment Banking division played a key role in facilitating the transaction’s closure among the parties.
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