Arcapita and Dgpays Acquire NEOPAY Stake in $385M Deal to Drive Middle East’s Digital Payments Growth
Dubai, UAE – In a transformative move for the Middle East’s digital payments industry, Arcapita Group Holdings Limited (“Arcapita”), a leading global alternative investment firm, and Dgpays, a top-tier financial infrastructure technology provider, have acquired a majority stake in NEOPAY. This acquisition, valued at $385 million, marks a significant milestone in NEOPAY’s growth journey. Mashreq, one of the UAE’s leading financial institutions, retains a significant minority stake in the company, reflecting its continued confidence in NEOPAY’s potential. The transaction, still subject to regulatory approvals, underscores the strategic importance of digital transformation in financial services across the region.
This deal positions NEOPAY to leverage the combined expertise and resources of Arcapita and Dgpays to expand its market reach, deliver cutting-edge payment solutions, and drive innovation in the UAE and beyond.
NEOPAY: Leading the UAE’s Cashless Revolution
Founded as a division of Mashreq, NEOPAY has emerged as a trailblazer in the UAE’s digital payments ecosystem. Over the years, it has played a pivotal role in supporting the UAE’s cashless economy initiatives by offering seamless payment solutions to a diverse range of industries, including retail, hospitality, government services, and e-commerce.
NEOPAY’s growth trajectory has been bolstered by the UAE’s vibrant economy, which is characterized by:
- A tech-savvy, youthful population: The high penetration of smartphones and increasing digital literacy have driven the adoption of digital payment solutions.
- Strong economic fundamentals: The UAE’s GDP growth, bolstered by robust infrastructure projects and foreign investment, provides fertile ground for the payments sector.
- Government support: Initiatives such as the UAE Vision 2021 and Smart Dubai have prioritized digital transformation across all sectors, creating opportunities for innovation in payments.
With card transaction values in the UAE projected to grow at double-digit rates over the next five years, NEOPAY is well-positioned to capitalize on this booming market.
A Strategic Partnership for Regional Growth
The acquisition by Arcapita and Dgpays signals a new chapter for NEOPAY, as it seeks to expand its footprint across the Middle East. The collaboration combines:
- Arcapita’s global investment acumen: Known for its strategic investments in high-growth markets, Arcapita brings a wealth of financial resources and market insights.
- Dgpays’ technological expertise: As a leading financial infrastructure technology provider in the EMEA region, Dgpays offers advanced solutions that will help NEOPAY innovate and scale rapidly.
Speaking on the deal, Atif A. AbdulmalikCEO of Arcapita, stated:
“NEOPAY aligns perfectly with our investment strategy of acquiring market leaders in industries poised for growth. The UAE’s transition to digital payments, supported by increasing GDP, a tech-savvy population, and forward-looking government policies, presents a tremendous opportunity. We are committed to supporting NEOPAY’s next phase of growth, focusing on value-added services and expansion into new markets.”
Serkan OmerbeyogluCEO of Dgpays, highlighted the transformative potential of this partnership:
“NEOPAY’s rapid growth and innovation in the UAE’s payments sector have been remarkable. With Dgpays’ technology and expertise, we aim to accelerate NEOPAY’s success, not just in the UAE, but across the broader Middle East. Our goal is to advance digital transformation in financial services and create value for enterprise and SME customers alike.”
Mashreq’s Vision for NEOPAY’s Future
As the company that originally established NEOPAY, Mashreq remains a key stakeholder in its journey. By retaining a significant minority share, Mashreq underscores its commitment to fostering innovation in the digital sector payments.
Ahmed AbdullahGroup CEO of Mashreq, described the acquisition as a pivotal milestone:
“This transaction marks a major step in NEOPAY’s evolution, enabling it to scale its operations and solidify its position as a regional leader in digital payments. We are confident that Arcapita and Dgpays have the expertise and vision to help NEOPAY achieve its ambitious growth objectives across the Middle East.”
NEOPAY’s CEO Outlines Ambitious Growth Plans
At the helm of NEOPAY’s success is its CEO, Vibhor Mundhadawho has overseen the company’s impressive growth in recent years. Mundhada expressed excitement about the company’s future under its new ownership:
“With the backing of Arcapita and Dgpays, we are entering a new phase of development. NEOPAY has consistently delivered innovative solutions that add value to our customers. With the technological and financial support of our new investors, coupled with Mashreq’s ongoing involvement, we are poised to accelerate our growth within the UAE and expand our presence across the Middle East. Our focus remains on driving e-commerce innovation and promoting digital payment adoption in the region.”
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The Middle East’s Rising Digital Payments Market
The Middle East has emerged as a hotbed for digital payments innovation, driven by:
- E-commerce growth: The rapid rise of online shopping has created a surge in demand for secure and efficient payment solutions.
- SME digitalization: With governments encouraging small and medium enterprises to adopt digital tools, payment solutions are increasingly vital.
- Cross-border transactions: The region’s strategic location and global trade links necessitate advanced payment platforms for international commerce.
NEOPAY’s expansion aligns with these trends, offering the company a significant growth runway in both existing and new markets.
Advisory Excellence in Acquisition
The complexity and scale of this acquisition required expert advisory services from leading financial and legal institutions:
- Goldman Sachs International, DIFC Branch: Financial advisor to Mashreq.
- deNovo Partners: Strategic advice to Arcapita and Dgpays.
- Clifford Chance: Legal advisor to Mashreq.
- Freshfields Bruckhaus Deringer: Legal advisor to the Consortium.
- Mashreq’s Investment Banking division: Played a pivotal role in facilitating and executing the transaction.
With its new strategic investors, NEOPAY is set to enhance its platform, introduce value-added services, and expand its regional footprint. The company’s vision aligns with the broader goal of fostering a cashless society and supporting the UAE’s digital economy.
This acquisition is not just a milestone for NEOPAY but also a testament to the growth potential of the Middle East’s digital payments sector. As NEOPAY scales its operations, it aims to redefine the payments landscape, setting new benchmarks for innovation and customer satisfaction.