BPOPF will underwrite Letshego’s P800 million rights offer as the lender cuts debt, shrinks its African footprint and pursues a lower-risk regional strategy.
BONGANI MALUNGA
Letshego Africa Holdings is turning to shareholders for P800 million in fresh equity as the financial services group moves to cut debt, strengthen its balance sheet and build a smaller, lower-risk regional business.
BPOPF BACKING
According to a Letshego Africa Holdings Limited press release published on 29 September 2026, the proposed rights offer will see the Botswana Stock Exchange-listed group issue approximately 1.096 billion new ordinary shares at P0.73 each. The offer price represents an approximately 13.1 percent discount to the 30-day volume-weighted average traded price.
The capital raise has the full backing of Letshego’s largest shareholder, the Botswana Public Officers Pension Fund (BPOPF), which owns approximately 37.2 percent of the company and has agreed to fully underwrite the rights offer.
The underwriting gives Letshego greater certainty over the capital raise and signals significant institutional backing for a strategic reset that is reshaping the group into a leaner regional operation anchored in Botswana.
SMALLER FOOTPRINT
Letshego said it is simplifying its African portfolio through the proposed disposal of businesses in Ghana, Tanzania, Rwanda, Nigeria and Uganda, a transaction shareholders approved on 19 June 2026. The restructuring is designed to reduce exposure to more volatile markets, simplify the operating model and focus capital and management attention on stronger retained businesses.
Once the portfolio repositioning is completed, Letshego’s continuing footprint will comprise Botswana, Namibia, Mozambique, Lesotho, Kenya and Eswatini.
The P800 million injection therefore forms part of a broader effort to strengthen Letshego’s balance sheet while reducing the size and risk profile of the group.
DEBT RESET
Letshego said proceeds from the rights offer will primarily be used to reduce debt at holding-company level, including settling amounts owed to certain shareholders and transaction-related costs. The additional capital will also give the group greater capacity to allocate resources to priority markets and pursue strategic opportunities.
The restructuring comes against improving performance from the businesses Letshego intends to retain. Continuing operations delivered P284 million in profit in the 2025 financial year, representing a 362 percent improvement, while net impairments fell 77 percent and the loan-loss ratio improved to 1 percent, according to the September press release.
Letshego is also reshaping the way it funds its lending activities. Customer deposits increased 64 percent to P3.5 billion, while deposits from continuing operations rose 43 percent to P2.24 billion, supporting a push towards a more diversified and lower-cost funding model.
TARGETS AHEAD
Its strategic direction includes reducing reliance on higher-cost wholesale debt, expanding deposit-led funding, maintaining disciplined credit underwriting, improving operating efficiency and concentrating resources in stronger and more stable markets.
The company has set longer-term targets including a return on assets of between 3 and 5 percent, return on equity of between 20 and 25 percent, a cost-to-income ratio of between 40 and 45 percent and debt-to-equity below 100 percent. Letshego cautioned that the targets are forward-looking and do not guarantee future performance.
Letshego Group Chief Executive Officer Reinette van der Merwe said the rights issue formed part of efforts to prepare the company for its next phase. “The proposed rights issue represents a considered step in strengthening Letshego’s capital base and positioning the Group for its next phase,” she said.
She added that BPOPF’s underwriting reflected “strong institutional support for the transaction and confidence in the long-term potential of a more focused, resilient and profitable Letshego.”
The rights offer is expected to open at 09:00 on 23 October 2026 and close at 16:00 on 6 November 2026, while trading in the rights is scheduled for 23 to 30 October. The new shares are expected to begin trading on the Botswana Stock Exchange on 20 November 2026.