3. ACQUISITIONS

The cash paid, net of cash received related to the Company's various acquisitions that are discussed below during the year ended June 30, 2012, 2011 and 2010 are summarized in the table below:


	2012		2011		2010
SmartLife	$	1,673	$	-	$	-
Prepaid business		4,481		-		-
KSNET		-		230,225		-
MediKredit		-		-		981
FIHRST		-		-		9,338
Total cash paid, net of cash received	$	6,154	$	230,225	$	10,319

2012 acquisitions

Acquisition of prepaid airtime and electricity business in October 2011

On October 3, 2011, the Company acquired the South African prepaid airtime and electricity businesses of Eason & Son, Ltd ("Eason"), an Irish private limited company, for approximately $4.5 million in cash. The principal assets acquired comprise prepaid airtime and electricity businesses customer list, accounts receivable books, inventory and a perpetual license to utilize Eason's internally developed transaction-based system software ("EBOS").

The business has been integrated with EasyPay and allocated to the Company's South African transaction-based activities operating segment. The Company believes that the acquisition will enable it to expand its prepaid customer base and over time integrate all of its prepaid offerings onto the EBOS system.

SmartLife

On July 1, 2011, the Company acquired SmartLife (formerly known as Saambou Life Assurers Limited), a South African long-term insurance company, for ZAR 13 million (approximately $1.8 million) in cash. Prior to its acquisition by the Company, SmartLife had been administered as a ring-fenced life-insurance license by a large South African insurance company, had not written any new insurance business for a number of years and had reinsured all of its risk exposure under its life insurance products. SmartLife has been allocated to the Company's financial services operating segment.

The acquisition of SmartLife provides the Company with an opportunity to offer relevant insurance products directly to its existing customer and employee base in South Africa. The Company intends to offer this customer base a full spectrum of products applicable to this market segment, including credit life, group life, funeral and education insurance policies.

In November 2011, the Company sold 10% of SmartLife to a strategic partner for $0.1 million and recognized a loss on sale of $0.08 million.

The final purchase price allocation of the prepaid business and SmartLife acquisitions, translated at the foreign exchange rates applicable on the date of acquisition, are provided in the table below:


	Prepaid business			SmartLife			Total
Accounts receivable, net	$	1,083		$	152		$	1,235
Inventory		305			-			305
Customer relationships		895			-			895
Software and unpatented technology		2,449			-			2,449
Deferred tax liability		(251	)		-			(251	)
Cash and cash equivalents		-			169			169
Financial investments (allocated to other long-term assets)		-			3,059			3,059
Reinsurance assets (allocated to other long-term assets)		-			28,492			28,492
Other payables		-			(185	)		(185	)
Policy holder liabilities (allocated to other long-term liabilities)		-			(29,845	)		(29,845	)
Total purchase price	$	4,481		$	1,842		$	6,323

Pro forma results of operations have not been presented because the effect of the prepaid business and SmartLife acquisitions, individually and in the aggregate, were not material to the Company's consolidated results of operations. During the year ended June 30, 2012, the Company did not incur transaction-related expenditures related to these acquisitions.

Since the closing of the acquisition, the prepaid business and SmartLife acquisitions have contributed revenue of $14.3 million and $0.7 million, respectively, and a net loss, including intangible assets amortization, of $0.2 million and $0.3 million, respectively.

2011 acquisitions

98.73% of KSNET Inc. ("KSNET") in October 2010 and final settlement in December 2011

On October 29, 2010, the Company acquired KSNET for KRW 270 billion (approximately $240 million based on exchange rates on October 29, 2010), and a post-closing working capital adjustment. The acquisition of KSNET expands the Company's international footprint as well as diversifies the Company's revenue, earnings and product portfolio. In December 2011, the Company received $4.9 million, in cash, in final settlement of any and all claims and contractual adjustments between the Company and the former shareholders of KSNET. This amount has been applied against the goodwill recognized on the acquisition of KSNET and has reduced the goodwill balance. As required by the Company's Korean debt agreement, the Company has used the settlement proceeds to prepay a portion of its outstanding debt thereunder. The prepayment was made on January 30, 2012.

Most of KSNET's revenue is derived from the provision of payment processing services to approximately 220,000 merchants and to card issuers in Korea through its VAN. KSNET has a diverse product offering and the Company believes it is the only total payments solutions provider offering card VAN, PG and banking VAN services in Korea, which differentiates KSNET from other Korean payment solution providers and allows it to cross-sell its products across its customer base.

The following table sets forth the allocation of the purchase price:


		June 30,			Fiscal 2012			June 30,
		2012			settlement			2011
Cash and cash equivalents	$	10,507		$	-		$	10,507
Accounts receivable, net		28,748			-			28,748
Inventory		2,788			-			2,788
Current deferred tax assets		837			(74	)		911
Settlement assets		13,164			-			13,164
Long-term receivable		288			-			288
Property, plant and equipment		24,052			-			24,052
Goodwill (Note 9)		115,900			(4,239	)		120,139
Intangible assets (Note 9)		102,829			-			102,829
Other long-term assets		6,324			-			6,324
Trade payables		(9,643	)		-			(9,643	)
Other payables		(14,789	)		(696	)		(14,093	)
Income taxes payable		(3,363	)		-			(3,363	)
Settlement obligations		(13,164	)		-			(13,164	)
Long-term deferred income tax liabilities (Note 19)		(24,459	)		-			(24,459	)
Other long-term liabilities		(1,199	)		-			(1,199	)
Total net assets attributable to shareholders, including goodwill		238,820			(5,009	)		243,829
Less attributable to non-controlling interest		(3,033	)		64			(3,097	)
Total purchase price	$	235,787		$	(4,945	)	$	240,732

The Company incurred transaction-related expenditures of $5.6 million during the year ended June 30, 2011.

19.9% of Net1 Universal Electronic Technologies (Austria) AG, formerly BGS Smartcard Systems AG ("Net1 UTA")

On December 23, 2010, the Company acquired the remaining 19.9% of the issued share capital of Net 1 Universal Technologies (Austria) AG ("Net1 UTA") for $0.6 million in cash. The Company now owns 100% of Net1 UTA. The transaction was accounted for as an equity transaction with a non-controlling interest and accordingly, no gain or loss was recognized in the Company's consolidated statement of operations. The carrying amount of the non-controlling interest was adjusted to reflect the change in ownership interest in Net1 UTA. The difference between the fair value of the consideration paid and the amount by which the non-controlling interest was adjusted, of $0.9 million, was recognized in equity attributable to Net1.

MediKredit Integrated Healthcare Solutions (Proprietary) Limited ("MediKredit")

On January 1, 2010, the Company acquired 100% of MediKredit, a South African private company, for ZAR 74 million (approximately $10 million) in cash. MediKredit offers transaction processing, financial and clinical risk management solutions to both health care plans and health care service providers, primarily in South Africa.

FIHRST Management Services (Proprietary) Limited business and related software (collectively "FIHRST")

On March 31, 2010, the Company acquired FIHRST, a South African business, for ZAR 70 million (approximately $9 million). FIHRST offers a third-party and associated payroll payments solution to companies in South Africa.

The final purchase price allocation of the MediKredit and FIHRST acquisitions, translated at the foreign exchange rates applicable on the date of acquisition, are provided in the table below:


		MediKredit			FIHRST			Total
Cash and cash equivalents	$	9,005		$	77		$	9,082
Accounts receivable, net		2,940			640			3,580
Property, plant and equipment		1,290			106			1,396
Intangible assets (see Note 9)		6,070			7,983			14,053
Trade and other payables		(9,931	)		(337	)		(10,268	)
Deferred tax assets		2,718			436			3,154
Deferred tax liabilities (see Note 19)		(2,097	)		(623	)		(2,720	)
Goodwill (see Note 9)		-			1,187			1,187
Total purchase price	$	9,995		$	9,469		$	19,464

Pro forma results of operations have not been presented because the effect of the MediKredit and FIHRST acquisitions, individually and in the aggregate, were not material to the Company's consolidated results of operations. During the year ended June 30, 2010, the Company incurred transaction-related expenditures of $0.4 million related to these acquisitions. Such expenditures were recognized in the Company's consolidated statements of operations