Thai-listed firm acquires 29.99% stake in Commercial Credit and Finance in $70 mln deal

Group Lease Public Company Ltd (GLPCL), a digital finance company listed on the Stock Exchange of Thailand (SET), has acquired a 29.99 per cent stake in Commercial Credit and Finance Plc (CCF) for US$ 70 million.

The transaction valued at over Rs. 10.56 billion is one of the highest recorded on the Colombo Stock Exchange, (CSE) the company said in filing in the CSE on Thursday.

During the same exercise, BG Investments (Pvt) Ltd and related companies along with CCF sold their 100 per cent stake in microfinance subsidiary in Myanmar - BG Microfinance Myanmar Co Ltd (BGMM) - for a consideration of $8 million to GLPCL. The CCF stake of 28.1 per cent was valued at $2.28 million. CCF will book a profit of Rs. 277.21 million before taxes on the transaction.

“First announced in September this year, the former is a historical transaction in terms of size. Two years ago, the investment of Rs. 1.68 billion (US$12.8 million equivalent) by Creation Investments Sri Lanka LLC was the biggest foreign investment into a finance company. Commercial Credit is very happy to partner with GLPCL where we see a long term win-win partnership through this investment with many opportunities for capital raising, synergies and growth,” said Commercial Credit’s Chief Operating Officer Rajiv Casie Chitty.

GL’s Chairman/CEO Mitsuji Konoshita sees this decision to buy 29.99 per cent of CCF as one which will further enhance the strategic partnership between the two groups. “We look to combine our efficient digital finance platform with CCF’s very successful track record in the field of finance, to grow our business- es in all markets where we are and will be present, while CCF’s need to access to capital can easily be met by our capability to raise funds internationally”.

The acquisition marks GL’s first major expansion outside of the ASEAN region. From its home base in Thailand, GL has expanded successfully into Cambodia, Laos, Indonesia and, more recently, Myanmar through BGMM.

With a history of 34 years, CCF is one of Sri Lanka’s leading finance companies with a total asset base of Rs. 70 billion as at 31 March 2016.

First announced in September this year, the former is a historical transaction in terms of size. Two years ago, the investment of Rs. 1.68 billion (US$12.8 million equivalent) by Creation Investments Sri Lanka LLC was the biggest foreign investment into a finance company.