SmartPay Now New Zealand’s Largest EFTPOS Provider

Smartpay Purchases Provencocadmus Payments Business

SmartPay Now New Zealand’s Largest EFTPOS Provider

Auckland, 19 August 2009 – Leading Merchant Services provider SmartPay Ltd (NZX: SPY) announced today that it has reached an agreement with the Receivers of ProvencoCadmus to purchase the Payments Division of the company, including the New Zealand and Australian payments operations, transactional business and all intellectual property relating to payments.

Provenco, one New Zealand’s largest providers of EFTPOS related products and software, merged with Cadmus in 2007, with the intention to develop the company into a major international provider of payment terminals and went into receivership due to unsustainable debt, lack of investment capital and a weaker than expected trading performance in its retail automation business.

SmartPay Managing Director Ian Bailey says the purchase by SmartPay will add significant value to SmartPay’s strategy of increasing its customer base and consolidate its position as a leading provider of integrated merchant services.

“The ProvencoCadmus customer base will augment SmartPay’s current clients so that the combined Company of over 25,000 terminals installed in the market has the scale and reach to deliver ongoing efficiencies, business opportunities and revenue both in New Zealand and internationally. It will also increase SmartPay’s product offering that includes VoIP, Broadband, EFTPOS terminals and secure EFTPOS internet connectivity through to audio and video, music, messaging as well as managing one of the largest Wi-Fi networks in New Zealand,” says Bailey.

Bailey says that the purchase of ProvencoCadmus is very exciting for the future growth of SmartPay.

“The shared history, common links and synergy between both businesses is very strong. Many of the staff who assisted in establishing Cadmus are now employed by Smartpay so we understand the ProvencoCadmus payments business very well. Initially we will keep the ProvencoCadmus business separated from the current SmartPay business so that both entities remain focused on their business plans and strategies. In terms of ProvencoCadmus payments we will return to the Cadmus successful growth strategy in place prior to the merger and focus on developing and growing the customer base.”

In addition, Bailey says that SmartPay intends to continue to develop and distribute the PAX brand of EFTPOS terminals, as well as utilise the Intellectual Property and know-how relating to the Cadmus brand to the benefit of all customers.

Bailey says that the ProvencoCadmus acquisition also fits neatly into SmartPay’s growth strategy which has already seen the purchase of several other companies including All Talk Communications, Merchant IP Services, and Wi-Fi provider FIVO.

“The acquisition of ProvencoCadmus correlates to the recent announcements where SmartPay advised the market that it would be looking for synergistic business acquisitions that fitted the Company‘s core business sectors.”

It is planned to amalgamate SmartPay into the existing business offices of Provenco Cadmus as the current SmartPay offices will not meet the new expanded needs of the business.

ENDS

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