The consideration is US$3,187,000, which LonZim will pay in cash out of its own resources.Â Included in the acquisition is the newly built, modern commercial property in Harare from which Paynet Zimbabwe operates, valued at US$1,025,000, and other fixed and current assets valued at $371,500. Based on the Zimbabwe Dollar monthly earnings for Lanuarna for 2007, converted to US Dollar figures using the Old Mutual Implied Rate, the profit before tax for 2007, after removing non-realised exchange rate losses and non-recurring expenses, was US$569,000, giving a PBT multiple of 3.15.Â Lanuarna wholly owns three operating companies in Zimbabwe – Paynet Zimbabwe, Paywell and Autopay – and holds 100 per cent of the property holding company, Le Har.Â It also has a 51 per cent stake in a joint venture company, Tradanet.Lanuarna has been established and successfully operating in Zimbabwe for ten years and has experienced growth in its core businesses in the past four years, despite the current economic situation.The Paynet Zimbabwe system is an Electronic Funds Transfer (EFT) system that automates the process of companies transmitting bulk payment instructions to their corresponding banks and financial institutions such as salary transfers, supplier/trade payments and direct debits.Â This creates a cost-effective and efficient means of transferring funds that is advantageous to both the company and the bank, which has contributed greatly to the rapid success of Paynet Zimbabwe in the past few years, particularly as more basic manual fund transfer methods have become more expensive and error-ridden.Â In addition to the provision of software systems Paynet Zimbabwe provides a complete outsourced service to its clients for the management of the systems and for providing all training and ongoing technical support to corporate users.AutoPay is Zimbabwe’s largest private sector outsourced salary bureau, processing salaries for corporate clients across Zimbabwe.Â Apart from simply calculating and processing salaries, Autopay provides a complete end-to-end service for managing salary payments, third party payroll creditors, submission of statutory returns, medical aid returns, pension payments, printing of pay slips and production of hard and soft copy accounting reports. Paywell in Zimbabwe is an agent for the Paywell payroll system, licensed out of South Africa. Paywell sells and supports the payroll software to Zimbabwe’s largest companies. The company offers both support and training to users either through its own in-house staff or through a number of consultants that have the necessary skills.Tradanet is a 51% owned joint venture company with Ottonby (Pvt) Ltd. Tradanet provides a service for client employees to access small loans at reduced interest rates from the Central Africa Building Society.Â Le Har is a property owning company and holds the title deeds for the modern and up-market Lanuarna offices in the Mt Pleasant Business Park.David Lenigas, Executive Chairman of LonZim, commented.”The purchase of Paynet, strategically complements LonZim’s previous investment in the Zimbabwean publicly listed company Celsys. These are businesses that are already successful in the current economic environment, demonstrating their strength and potential, and are incredibly well positioned to benefit significantly from an economic upturn in Zimbabwe.Â With low overheads and a strong and established client base we believe that the acquisition adds considerable value to the growing LonZim portfolio of companies and we look forward to building the LonZim stable of financial companies in this exciting market.”It should be noted that the figures used in this announcement have been derived from Zimbabwe Dollar based accounts; Lanuarna operates in a hyper-inflationary environment subject to exchange rate fluctuations making its financial statements (and those of its subsidiaries) and conversion to US Dollar figures open to wide differences in interpretation. In an effort to quantify the transaction values, Ernst & Young Zimbabwe have calculated a US Dollar earnings figure for Lanuarna by converting the Zimbabwe Dollar monthly earnings figures for 2007 to US Dollar figures using the Old Mutual Implied Rate.