$ 15.05 million acquisition of NEOVIA Financial, former Neteller

NEOVIA Financial Plc, former Neteller has announced an agreement to acquire IDT Corporation’s European Prepaid Payment Services Division for a total cash consideration of US$ 15.05 million (approximately £ 10.0 million) to be satisfied out of the Company's existing cash resources.

 “The acquisition of IDT Finance represents a major milestone in the development of our financial services offering to both our consumers and merchants and in our overall strategy to diversify our business. The integration of IDT Finance’s well-regarded prepaid debit card operation and banking licence will enable us to leverage our existing capabilities to offer additional products and services. We welcome IDT Finance to NEOVIA and look forward to developing the full potential of the business as part of our broader strategic vision,” commented Ron Martin, President & Chief Executive Officer of NEOVIA.

 “NEOVIA’s considerable resources and expertise will expand the range of financial services available to IDTFS customers while nicely complementing NEOVIA’s existing capabilities,” added Howard Jonas, Chairman of IDT Corporation.  

The proposed acquisition is subject to the approval of the Gibraltar FSC of the transaction and MasterCard not objecting to the proposed change of control of IDTFS. NEOVIA expects that the acquisition will be accretive to earnings before one-off costs in the first full year after completion assuming that completion occurs early in 2009.

Some agreement highlights:
• Agreement to purchase the entire issued share capital of IDT Financial Services Holdings Limited (owner of IDT Financial Services Limited (“IDTFS”)) and certain other assets which together provide prepaid MasterCard® products in the UK market under the IDT “Prime Card” brand. 
• Total cash consideration of US$ 15.05 million to be paid to IDT Corporation on completion – this includes US$ 10 million of banking regulatory capital. 
• Key strategic acquisition for NEOVIA, adding new product lines and distribution based on the IDT Prime Card, accelerating the development of NEOVIA’s prepaid Net+ card business and rapidly increasing the Company’s active NETELLER e-wallet customer base. 
• In combination with NEOVIA’s Net+ card services, creates one of Europe’s largest independent prepaid debit card businesses. 
• Acquisition of IDTFS, which operates under a banking licence issued by the Gibraltar FSC, will allow development in the long term of additional financial services for NEOVIA’s consumer and merchant customers. 
• Acquisition conditional on Gibraltar FSC regulatory approval and MasterCard consent.