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Net Element Announces Acquisition of Recurring Cash Flow Portfolio

Acquisition is Projected to Add Over $4 Million in Gross Profits Over the Next 4 Years

MIAMI, FL, Dec. 27, 2018 (GLOBE NEWSWIRE) -- via NEWMEDIAWIRE – Net Element, Inc. (NASDAQ: NETE) (“Net Element” or the “Company”), a global technology and value-added solutions group that supports electronic payments acceptance in a multi-channel environment including point-of-sale (“POS”), e-commerce and mobile devices, announced today it has acquired certain transactional services portfolio (cash flow) assets from Argus Merchant Services, LLC (“Argus”) and Treasury Payments, LLC (“Treasury”).

Net Element, through its subsidiary Unified Portfolio Acquisitions, acquired the cash flow assets for a total of $1.42 million, which are expected to generate well over $4 million in gross profits over the next four years and expected to continue generating profits thereafter. In addition, the total billing commitment by Argus to the Company’s Unified Payments subsidiary over the next 5 years is expected to generate over $19 million in gross margin for the Company. The Company, Argus, and Treasury have enjoyed a successful and mutually beneficial partnership over the last five years. The newly acquired cash flow assets are expected to enhance the Company’s profit margins.

“The transactional services portfolio acquisition takes our relationship with Argus and Treasury to the next level.  This acquisition will build real value for the future of our respective companies,” commented Vlad Sadovskiy, president of integrated payments for Net Element. “We are excited to see a significant commitment from Argus which is expected to add over $19 million in gross margin to the Company over the next 5 years.”

“We are excited to expand and continue our relationship with Net Element,” commented Eugene Gold, managing partner of Argus Merchant Services and CEO of WOW Payments. “The unprecedented support and commitment we have received from Net Element has not only helped us grow our business, but also establish strategic partnerships with our ISO’s and agents. We feel confident that this transaction will boost our continued growth and establish a strong leading presence in the market.”

About Net Element

Net Element, Inc. (NASDAQ: NETE) operates a payments-as-a-service transactional and value-added services platform for small to medium enterprise ("SME") in the U.S. and selected emerging markets. In the U.S., the Company aims to grow transactional revenue by innovating SME productivity services using various technology solutions and Aptito, our cloud-based, restaurant and retail point-of-sale solution. Internationally, Net Element's strategy is to leverage its omni-channel platform to deliver flexible offerings to emerging markets with diverse banking, regulatory and demographic conditions. Net Element was ranked as one of the fastest growing companies in North America on Deloitte's 2017 and 2018 Technology Fast 500™. In 2017 we were recognized by South Florida Business Journal as one of 2016's fastest-growing technology companies. Further information is available at www.NetElement.com.

Forward-Looking Statements

Securities Exchange Act of 1934, as amended. Any statements contained in this press release that are not statements of historical fact may be deemed forward-looking statements. Words such as "continue," "will," "may," "could," "should," "expect," "expected," "plans," "intend," "anticipate," "believe," "estimate," "predict," "potential," and similar expressions are intended to identify such forward-looking statements. All forward-looking statements involve significant risks and uncertainties that could cause actual results to differ materially from those expressed or implied in the forward-looking statements, many of which are generally outside the control of Net Element and are difficult to predict. Examples of such risks and uncertainties include but are not limited to whether the transactional services residuals acquisition will be beneficial to the Company, whether the Company will achieve the projected $4 million gross profits over the next four years and additional profits thereafter, whether the $19 Million in gross margin from the referenced billing commitments by Argus will be realized. or whether the acquisition will enhance the Company’s profit margins. Additional examples of such risks and uncertainties include, but are not limited to (i) Net Element's ability (or inability) to obtain additional financing in sufficient amounts or on acceptable terms when needed; (ii) Net Element's ability to maintain existing, and secure additional, contracts with users of its payment processing services; (iii) Net Element's ability to successfully expand in existing markets and enter new markets; (iv) Net Element's ability to successfully manage and integrate any acquisitions of businesses, solutions or technologies; (v) unanticipated operating costs, transaction costs and actual or contingent liabilities; (vi) the ability to attract and retain qualified employees and key personnel; (vii) adverse effects of increased competition on Net Element's business; (viii) changes in government licensing and regulation that may adversely affect Net Element's business; (ix) the risk that changes in consumer behavior could adversely affect Net Element's business; (x) Net Element's ability to protect its intellectual property; (xi) local, industry and general business and economic conditions; and (xii) adverse effects of potentially deteriorating U.S.-Russia relations, including, without limitation, over a conflict related to Ukraine, including a risk of further U.S. government sanctions or other legal restrictions on U.S. businesses doing business in Russia. Additional factors that could cause actual results to differ materially from those expressed or implied in the forward-looking statements can be found in the most recent annual report on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K filed by Net Element with the Securities and Exchange Commission. Net Element anticipates that subsequent events and developments may cause its plans, intentions and expectations to change. Net Element assumes no obligation, and it specifically disclaims any intention or obligation, to update any forward-looking statements, whether as a result of new information, future events or otherwise, except as expressly required by law.

Contact:
Net Element, Inc.
+1 (786) 923-0502
www.netelement.com
Media@NetElement.com

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