LOLC is one of the best performing global microfinance groups, and the investment is in-line with the Fund’s strategy of picking the top performer of each theme or category. Its business model is targeting the “bottom of the pyramid”, including increasing access to MSME financing and customer deposits, thereby driving LOLC’s financial inclusion goal.
The Fund’s investment will provide LOLC Africa with more funding to support and expand the lending activities of its existing subsidiaries in Africa, which are mainly targeted at micro, small and medium sized enterprises (MSMEs). In addition, the investment will strengthen the capital bases of the existing and potentially new subsidiaries in Africa. LOLC’s expansion of the MSME lending model is not only about pursuing its commercial ambition but doing so in a sustainable and socially responsible manner to deliver tangible benefits to those communities at the bottom- of-the-pyramid, who are often underserved by formal financial institutions including commercial banks, thereby promoting financial inclusion, job creation, income generation, and economic growth. The investment represents a diversified exposure to different markets in Africa following LOLC’s entry into Africa and as they scale their African business.
The Fund’s investment is yielding a return aligned with the Fund’s return target.
Verdant Capital Hybrid Fund is investing in inclusive financial institutions on a pan-African basis, with a focus on digitally enabled financial institutions providing services to micro, small and medium-sized enterprises. The Fund is investing in hybrid capital instruments including subordinated debt, mezzanine instruments, preference shares and stapled investment structures. The Fund has a size of USD 36 million as at First Close in December 2021 (target of USD 100 million at Final Close in 2024).
Suits & Advisors ("S&A") acted as an advisor to LOLC on this transaction.
Distributed by APO Group on behalf of Verdant Capital.
Media enquiries:
Verdant Capital:
Liezel van Greunen,
T: +27 10 140 3700
E: liezel.vangreunen@verdant-cap.com
LOLC:
Amandi Weerasinghe, Group Treasury Executive
T: +94 115 880 999
E: AmandiW@lolc.com
About Verdant Capital:
Verdant Capital is an investment manager and investment bank specialising in the private capital markets and operating on a Pan-African basis. Verdant Capital is the manager of the Verdant Capital Hybrid Fund.
About LOLC:
LOLC is one of the most strategically diversified global conglomerates dominating the Asian market and now making giant strides to entrench its presence across Africa and Central Europe. The Group is engaged in leisure, plantations, agri inputs, renewable energy, construction and real estate, manufacturing and trading, technology, research & innovation and other strategic investments. As a leading player in the international MSME sector, the Group has been a catalyst in facilitating financial inclusion, whilst striving to maximise environmental benefits through green operations and processes in line with its triple bottom line focus.
Present in the continents of Asia, Africa and Australia, the Group operates in Singapore, Sri Lanka, Myanmar, Indonesia, Philippines, Cambodia, Pakistan, Maldives, Zambia, Zimbabwe, Nigeria, Tajikistan, Tanzania, Malawi, Egypt, Kenya, Maldives, Mauritius, the United Arab Emirates, Sierra Leone, the Democratic Republic of Congo and Ghana, with further strategic plans held in pipelines. The Group operates non-bank financial institutions in 15 countries.
Over the years, the Group has been backed strongly by Development Finance Institutions and multilateral funding lines, which reflects the confidence these global entities place in the Group’s sustainable operations.
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