dfcu Sells 27.5% Shares To Netherlands Investment Fund


buy geneva;”>“The increased investment from 10 to 27.5 per cent reaffirms Norfund’s commitment to the bank and is a sign of confidence in the financial services industry of Eastern Africa, health ” Norfund said in a statement seen by Chimpreports today.

Rabo Development B.V, a subsidiary of Rabobank of the Netherlands, will acquire a 27.54 per cent share in dfcu Limited as part of today’s transaction.

Rabo Development B.V. has a number of partner banks on the African continent and said it would further develop dfcu Bank Ltd “by contributing with experience from banking, specifically within the area of agribusiness lending.”

CDC Group plc, the British development finance institution, previously owned 60 percent of the shares and will after the transaction retain a 15 percent share in the bank.

Norfund has been a shareholder in dfcu Limited since 2004 and claims to have supported the subsidiary bank dfcu Bank Ltd with “several longer term credit lines.”

“This has facilitated the bank in its mandate to extend credit to businesses and individuals. The bank’s range of products and services has broadened significantly of the last couple of years and best practice governance structures have been established. dfcu Bank Ltd is currently the 5th largest bank in Uganda, and has a very strong local brand and outreach,” the statement noted.

“Based on this development, and our knowledge of the capabilities of both the management and the organization as a whole, we are confident that this investment will be a positive contribution to achieving Norfund’s mandate.”

Over the last ten years, Norfund claims to have built a portfolio of promising investments in African financial institutions and the sector continues to be a main priority.

“Well-functioning banks are imperative to development of the private sector, and in providing safe access to loans and deposits for private individuals. Norfund believes that the commercial potential of the sector is underestimated among non-African investors. Thus, we are very pleased to have brought along another European investor to partner with Norfund in dfcu Limited,” the Investment Fund said on Thursday.

dfcu on April 22, “voluntarily suspended” trading of dfcu Ltd Shares on Uganda Securities Exchange under Rule 5(1) c of the Uganda Securities Exchange Listing Rules.

“dfcu Limited informs the public that a major shareholder, Commonwealth Development Corporation (CDC), currently holding 60.02 percent of the Company’s shares, has received an expression of interest for the purchase of a substantial number of its shares in the Company which, if successfully concluded, may have an effect on the price of the Company securities,” Company Secretary, Agnes Tibayeita Isharaza, said then.

She added: “As a result of potential shareholder restructuring and the time required to obtain all the necessary securities market and banking approvals, dfcu has been granted permission to voluntarily suspend the trading of its shares on the Uganda Securities Exchange for a period of up to 4 weeks with effect from 22nd April 2013. Any agreement in this respect will be subject to the necessary regulatory approvals.”

Speaking today, Torbjørn Gaustadsæther, Norwegian Ambassador to Uganda said:

“The economic growth in Uganda is promising, and we hope to see more business interactions between Norway and Uganda in the future in order to assist in diversifying the economy and create more employment.”

Juma Kisaame, Managing Director dfcu Bank Ltd added: “I am, on behalf of the management and staff at dfcu Bank Ltd, pleased to see the renewed commitment from Norfund.”

Juma further welcomed Rabo Development as a partner to the bank and expressed hoped to continue growing its outreach amongst Ugandan businesses and individuals.

“Our goal has always been to finance the growth and development of our country and the region. Our existing and new shareholders as well as international lenders has provided the support required in order to achieve those objectives.”

Deepak Malik, Head of Department, Financial Institutions, Norfund added:

“Having worked closely with dfcu Bank Ltd since 2004, we feel confident that the bank will continue to prosper. Dfcu Bank Ltd has showed a tremendous ability to grow and develop products and services for the Ugandan market. Further, we have experienced a very professional handling of the deal by the Kampala stock exchange and local authorities”

Kjell Roland, Managing Director Norfund, said Norfund’s mission is to develop profitable businesses in countries where access to capital is low.

“DFCU is a great example of how our funds can support thousands of small businesses: a well-functioning local bank focusing on SMEs, which are vital to the economic development of the country. Investments in countries like Uganda can be done in a responsible and profitable manner, it is now time for Norwegian and international private investors to wake up to the opportunities available.”

About Norfund

Norfund is owned by the Ministry of Foreign Affairs and serves as an instrument in Norwegian development assistance policy.

The fund contributes to “poverty reduction and economic development through investments in profitable businesses and transfer of knowledge and technology.”

The fund always invests together with partners (Norwegian or international). The three main industries for investments are renewable energy, financial institutions and agribusiness.

Norfund’s geographical agri-business focus is in East and Southern Africa, with offices in Nairobi, Johannesburg and Maputo. In addition, Norfund invests in selected countries in Asia and Latin America, with a regional office in Costa Rica.

Norfund has 50 employees world-wide and USD 1.3 billion in committed investments in 2012.


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