Net 1 Announces Intention to Acquire Prism Holdings Limited

Net 1 UEPS Technologies, Inc. (the "Company") announced today that its subsidiary, Net 1 Applied Technologies South Africa Limited ("Net 1 SA"), has submitted to the board of directors of Prism Holdings Limited ("Prism"), a South African public company whose shares are listed on the JSE Limited, a letter detailing Net 1 SA's proposed offer to acquire from Prism shareholders all the issued ordinary share capital of Prism for ZAR1.02 per share, or approximately $0.16 per share using the ZAR:$ exchange rate as of February 8, 2006, for a total cash consideration of approximately $100 million.

Prism is a company focused on the development and provision of secure transaction technology, solutions and services. Prism's core competencies around secure online transaction processing, cryptography and integrated circuit card (chip/smart card) technologies are principally applied to electronic commerce transactions in the telecommunications, banking, retail, petroleum and utilities market sectors. These technologies form the cornerstones of what Prism calls the "trusted transactions" environment and provide Prism with the building blocks for developing secure end-to-end payment solutions.

Unlike common mergers and acquisition practice in the United States where transactions are typically announced only after completion of due diligence and final negotiation of definitive transaction documentation, South African rules require public announcement of an acquisition transaction as soon as the principal terms of the transaction have been established. Thus, on February 9, 2006, Net 1 SA, together with Prism, made a joint announcement (the "Firm Intention Announcement"), advising Prism's shareholders that Net 1 SA had submitted to the Prism board a notice of Net 1 SA's firm intention to make the offer.

The making of the offer, and the consummation of the acquisition, are subject to a number of conditions, including satisfactory completion of the Company's due diligence, no Prism material adverse change, approval by Prism shareholders and the receipt of South African regulatory and other relevant approvals. There is no assurance that Net 1 SA will ultimately make the offer or that if made, the acquisition of Prism shares will be completed.

The sending of an offer circular to Prism's shareholders will be subject to:

* the conclusion of satisfactory arrangements relating to the treatment of Prism's existing incentive scheme and to the incorporation of Prism employees into the Company's employee incentive program, as appropriate; and

* the conclusion of an implementation agreement incorporating the terms and conditions set out in the offer and such other terms as are reasonably acceptable to the parties.

Prism shareholders, including certain Prism directors and employees, holding approximately 43% of Prism's shares, have entered into irrevocable undertakings to vote in favor of the offer.

As required by South African regulations, the Firm Intention Announcement and Net 1 SA's written proposal to the Prism board contained a statement that the Company's financial adviser, Morgan Stanley South Africa (Proprietary) Limited ("Morgan Stanley"), had provided confirmation to the South African Securities Regulation Panel (the "Panel") that the Company has and will have sufficient resources available to satisfy full acceptance of the offer. The Company has provided to Morgan Stanley, in support of its confirmation to the Panel, a written undertaking that, until completion of the transaction, the Company will set aside and not use for any purpose other than completion of the transaction, cash in the amount of approximately ZAR700 million (approximately $113 million at the February 8, 2006 ZAR:$ exchange rate). As of December 31, 2005, the Company had cash and cash equivalents of approximately $183.9 million. The Company believes that without regard to this ZAR700 million, the Company's remaining cash reserves, together with cash resources available under an overdraft facility and revolving credit facility, will continue to be sufficient to fund the Company's activities and expansion plans for the foreseeable future.

The Company's management believes that the acquisition of Prism would provide the opportunity to:

* augment the Company's management team, technical staff and development professionals;

* enhance the Company's geographical penetration in South Africa via Prism's terminals located in semi-urban stores, and thereby strengthen the Company's merchant acquiring footprint;

* expand the Company's product lines to include services such as Prism's prepaid water and electricity and mobile phone business;

* increase the total number of transactions the Company processes and is capable of processing;

* amplify the Company's technological advantage by providing the Company with access to Prism's SIM card patented cell phone technology;

* expand the Company's market reach into new geographical areas such as the Philippines, Indonesia and Malaysia through Prism's existing operations; and

* take advantage of Prism's smart card manufacturing capabilities.