Lanka Orix Leasing Co Plc (LOLC), Sri Lanka’s second largest non-banking financial institution by asset size, acquired a 50.1 per cent equity stake in Pak Oman Microfinance Bank Ltd (POMB) by way of a primary issuance of shares by POMB.

POMB is a Pakistan-based microfinance company promoted by the Oman government (with a 67 per cent shareholding) and Pak Oman Investment Co, a joint venture between the governments of Pakistan and the sultanate (with a 33 per cent holding).

Alpen Capital (ME) Ltd, Dubai acted as the financial adviser to LOLC, a statement said.

The signing ceremony of the shareholder agreement was held on February 3 in Colombo and was attended by H E Yahya al Jabri, chairman of Pak Oman Investment Co and POMB; Bahauddin Khan, CEO and managing director of Pak-Oman Investment Co; Ishara Nanayakkara, deputy chairman of LOLC Group, Sri Lanka; Rohit Walia, executive chairman of Alpen Capital; along with other members from the teams of Lanka Orix, Pak Oman and Alpen Capital.

“I am pleased to welcome Lanka Orix Group as our strategic partner for Pak Oman Microfinance Bank. We appreciate their success in SME and microfinance business in several countries and believe they can add significant value to our business. The investment demonstrates their confidence in the business model and sponsor groups and we look forward to a long term relationship with them,” said H E Jabri.

“We are extremely proud to support Lanka Orix Leasing Company in their growth strategy. We are seeing numerous prospects that exist within the subcontinent for strategic players and given our extensive experience in executing cross-border transactions, we are well positioned to connect our clients with the right opportunities,” said Walia.

“I am delighted that LOLC Group has been selected as the preferred partner to take Pak Oman Microfinance Bank forward, a strong indication of the expanding developmental role we have played in microfinance not only in Sri Lanka, but in our neighbouring Southeast Asian countries as well.

This partnership stems from a shared belief that micro entrepreneurs form the backbone of the economy, and are committed to enabling access to financial services and training that will not only facilitate sustainable business growth, but empower future generations in these communities,” said Nanayakkara.

Licensed by the State Bank of Pakistan, POMB offers a range of micro credit and micro savings products and services to the under privileged segments of society in Pakistan. POMB will stand to benefit from the vast experience and expertise LOLC has in the micro finance business, evidenced by successful ventures in Sri Lanka, Cambodia and Myanmar, and expects to significantly scale up its operations under the guidance of the new strategic shareholder.

Lanka Orix commenced operations as a leasing company in 1982 and has since expanded its offerings to include microfinance, factoring, savings and deposits, tailored financial products for the SME sector, Islamic financing and foreign currency deposits. The group has also expanded into fleet management, information technology and vehicle-related services.

LOLC is one of the largest and most diversified conglomerates in Sri Lanka with a portfolio which is broadly categorised as financial services and non-financial services, encompassing leisure, plantations, agree inputs, renewable energy, construction, manufacturing and trading, and other strategic investments.(MD)