Group Lease in­vests in Sri Lankan fi­nance firm

The Sun (Malaysia) - - SUNBIZ -

BANGKOK: Thai mo­tor­cy­cle lessor Group Lease PCL has ac­quired a 30% stake in Sri Lanka’s Com­mer­cial Credit and Fi­nance PLC (CCF) for US$70 mil­lion (RM289 mil­lion), the com­pany said yes­ter­day, in its first ma­jor ex­pan­sion out­side South­east Asia.

The ac­qui­si­tion comes a month after it bought a 71.9% stake in BG Mi­cro­fi­nance Myan­mar from the Sri Lanka fi­nance firm to ex­pand into Myan­mar, adding to ex­ist­ing op­er­a­tions in South­east Asian coun­tries in Cam­bo­dia, Laos and In­done­sia.

Group Lease, part of Ja­pan’s Wedge Hold­ings Co, has the right to buy the re­main­ing 70% in CCF if ex­ist­ing share­hold­ers want to sell the stake, chair­man and chief ex­ec­u­tive Mit­suji Konoshita told a joint news con­fer­ence.

Group Lease plans to com­bine its dig­i­tal fi­nance plat­form, in­clud­ing elec­tronic pay­ment and in­surance, with CCF’s mi­cro­fi­nance model to grow busi­ness, Konoshita said, adding it ex­pects to be­gin book­ing profit from the pur­chase in the fourth quar­ter and CCF is ex­pected to gen­er­ate profit of US$7 mil­lion a year.

CCF has as­sets of US$500 mil­lion, of which one-fifth is in the mi­cro­fi­nance busi­ness, and ex­pects a net profit of US$22 mil­lion this year, CCF chief ex­ec­u­tive Roshan S. Egodage said.

The Thai firm, which is look­ing to buy more as­sets, is also buy­ing an ad­di­tional 28.1% in BG Mi­cro­fi­nance from CCF to gain com­plete con­trol in the My­na­mar firm, he said.

Thai op­er­a­tions con­trib­uted about 40% of Group Lease’s profit, while the rest came from for­eign op­er­a­tions, mostly from Cam­bo­dia, Konoshita said.

With as­sets of US$450 mil­lion, Group Lease is one of Thai­land’s big­gest three mo­tor­cy­cle lessors with a mar­ket share of 10% to 11%. It is the mar­ket leader in Cam­bo­dia and Laos with shares of 95% and 40%, re­spec­tively.

Group Lease shares surged as much as 6.4% to 37.25 baht (RM4.44), out­per­form­ing a 0.5% gain in the main Thai mar­ket. – Reuters

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