LOLC Holdings Plc, a Sri Lankan holding company, will acquire nearly 73.2% of the shares of Key Microfinance Bank Plc, a microfinance bank operating in Kenya. Sri Lanka’s second-largest listed company by revenue recently obtained regulatory approval for the deal.
The holding company now takes control of the national microfinance bank licensed by the Central Bank of Kenya. Under the terms of the agreement, LOLC is expected to purchase 31.4 million shares at a price of $0.07 each, valuing the transaction at $2.1 million.
The multinational should help Key Microfinance to reorganize its basic banking system in order to improve its efficiency to be competitive in a micro-credit environment where competition is tight. The transaction also comes in a context where the Kenyan financial market is showing resilience despite the obstacles caused by the coronavirus pandemic.
Engaged in a process of exploiting the growing demand for microcredit, the Sri Lankan financial services company plans to expand its operations in Kenya.
