Letshego concludes P95 million take-over of AFB Ghana
Local financial service provider, Letshego Holdings Limited, will this year start operating in Ghana, following the approval of its AFB Ghana acquisition. AFB Ghana is another financial service provider that offers loans to government employees, private sector employees, and Micro & Small Entrepreneurs (MSE).
The second acquisition in West Africa after another acquisition in Nigeria in 2015, is expected to further grow and diversify Letshego’s footprint which now covers 11 countries across Sub-Saharan Africa.
Letshego Group CEO Chris Low last week told journalists that transactions to acquire AFB Ghana started in January 2016 and that his company is concluding the take-over. Letshego Group has paid initial owners of AFB Ghana around P95 million to acquire 100 percent ownership of the company and the Group CEO is confident that the businesses in Ghana would start contributing to their profits in 2017. Low believes that with over 600 000 government employed in Ghana and Letshego’s established strength in the financial sector, there is a significant opportunity for them to increase revenues and profits. “With Letshego’s expertise accumulated over the last 18 years in providing financial services to the formally and informally employees and MSE, there will be opportunities to introduce commercially sustainable product offerings that support agri-business, education, health, affordable housing and general business sector,” said Low. AFB Ghana’s fully automated and mobile-enabled delivery platform is expected to support the roll out of the envisaged product offerings.
According to Low, AFB Ghana is a good and profitable business and since its launch in 2010, it has grown to service over 600 000 customers through a country-wide network of more than 25 branches and customer access points. AFB is one of the largest non-bank financial service providers in Ghana and has operations across the country. Among others the company has financial products which allow access to credit via mobile wallets, as a platform to ensure financial inclusion.
Low stated that Letshego was looking for more opportunities to grow business and that when expanding it considers population and political stability factors for which Ghana ticks all boxes. Low considers the country as politically mature with a diversified credit market with mobile lending/saving solutions for average customers and lending for small businesses, an advantage for them.
Letshego is able to expand into the continent because as a public listed company regulators have confidence in its corporate governance. In addition to the local bourse, the group is listed in Johannesburg Stock Exchange. In fact, its shares traded at 229 thebe/share at the Botswana Stock Exchange by close of business on Friday.