Wed, Sep 17, 2014, 11:38 am SL Time, ColomboPage News Desk, Sri Lanka.
Sept 17, Colombo: Sri Lanka's Lanka Orix Leasing Company (LOLC) has acquired a 60 percent stake in Thaneakea Phum Cambodia (TPC), a rapidly growing, regulated microfinance institution in Cambodia, for US$ 20.3 million.
The acquisition was through LOLC' s fully owned subsidiary, LOLC Micor Investments Ltd. (LOMI), the microfinance arm of LOLC, the company said in a stock market disclosure Tuesday.
The LOLC Group said it has received all required regulatory approvals, including approvals from the Central Bank of Sri Lanka, Ministry of Finance of Sri Lanka, National Bank of Cambodia and the Ministry of Commerce of Cambodia for the acquisition.
TPC is the 5th largest microfinance company in Cambodia with a gross loan book of US$ 100 million, LOLC said.
TPC has 52 branches distributed throughout Cambodia, with a total staff of 1,100 personnel and currently has a customer base of 170,000 microfinance borrowers.
Further, it has a strong capital base and maintains a capital adequacy ratio of 16.8%, enabling the company to withstand potential shocks as well as providing a stable platform for strong growth, LOLC said.
This is LOLC's second overseas acquisition. The company first ventured into Cambodia in 2006 through its investment in PRASAC Micro Finance Institution Ltd (PRASAC), the largest microfinance Company in Cambodia. LOLC Currently holds 22.25% of PRASAC.
LOLC also has a microfinance company in Myanmar. LOLC Myanmar Micro-Finance Company Ltd was launched in 2013 as a green field operation in Myanmar.
The LOLC Group was the 1st Sri Lankan organization and the 4th international operator to commence operations in the Myanmar financial sector.
Identifying the immense potential in emerging economies of the South East Asian region, particularly in the microfinance sectors of Myanmar and Cambodia, together with the Group�s ability to create an impact as a practitioner of microfinance as well as taking in to consideration the potential for growth in these markets as an active investor, LOLC secured its third overseas venture when it acquired the majority share in TPC, LOLC said in a media release.
Ishara Nanayakkara, Deputy Chairman of the LOLC Group said the Group�s business expansion strategy is aimed at strengthening its core financial services business further.
"Within Sri Lanka, we have firmly and consistently held our position as the largest diversified Non-Bank Financial Institution to date whilst our top performing companies have each held strong footholds in diverse sectors of the country�s economy," he said.
"We are pleased that we were able to take our strategies and expertise overseas and to strengthen our position in the regional microfinance sphere."
He said the LOLC Group hopes to continue to explore opportunities to expand its overseas presence beyond Myanmar and Cambodia.
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