July 20, 2018 – JSE-listed Ecsponent Limited (“Ecsponent”) announced that it has secured an international funding facility for US$5 million (R67-million) from Norsad Finance Limited (“Norsad”) at market-related terms.
Ecsponent’s Investment Services business unit has raised R1.47 billion through its listed preference share programme between September 2014 and 31 March 2018. This capital has been deployed successfully and contributed to the Group’s exponential and sustained growth in recent years. Since 2012, the average annual compounded growth of the Group’s assets has been 104% per annum. Operating profit increased by average 131% per annum and revenue 66%.
One of the Group’s strategic objectives to maintain this growth curve, is to obtain intuitional funding to increase its available capital, while reducing the average cost thereof. During the last financial period, the Group secured US$15 million in international funding, which was subsequently deployed to expand its African operations and international asset base. This contributed to the Group’s asset and currency diversification, with 30% of its assets now held outside the Common Monetary Area.
“The US dollar-based funding will be deployed to expand Ecsponent’s growing operations and investments outside South Africa,” explains Terence Gregory, CEO of Ecsponent Limited.
“The demand for funding in Africa remains significant and we continue to realise attractive returns by deploying capital to our secured credit products. In addition, by using dollar-based funds, we continue to increase the hard currency assets on the Group’s balance sheet, which further reduces our risk exposure.”
“Raising institutional funding remains a key focus area, and the Norsad funding is another milestone achieved. We are actively pursuing further funding lines in local and foreign currency to continue our growth trajectory,” Gregory concluded.
Norsad Finance Limited is an impact investor that provides flexible and customized financing to mid-market companies and financial services providers in Southern Africa with the intention of driving economic growth, social advancement and environmental sustainability. Norsad finances strong commercial businesses and projects recognizing that growth needs to be sustainable and impact jobs (reduce poverty and unemployment), enable diversification (reduce dependence on resources and commodities) and promote economic and socio infrastructural effects. Norsad has disbursed over $300M to projects in Southern Africa.