CAL eyes Africa, Southeast Asia and South Asia
Three years after setting up its first foreign branch in Bangladesh, Capital Alliance Holdings Ltd (CALH), a Sri Lankan investment bank expanding to Kenya and the wider African region, is also looking at Southeast Asia and South Asia after its Rs.1.58 billion initial public offering (IPO), company officials said.
Nearly half of the IPO proceeds – issue is opening on May 8 – will be used to fund the CALH expansion into Kenya, which is targeted to materialise within one year, Ashvanth Vijayaram, Senior Vice President, CALH, said.
“Kenya will be a gateway to Africa, and eventually we plan to go to other countries. East African countries and then subsequently to West Africa as well,” he told The Sunday Times Business on Friday. The wider plan is also to move into Southeast Asian countries as well as the South Asian ones, he added. “At a later stage, we may move into countries like Pakistan,” he said. He said the idea is to expand into developing economies, but with underdeveloped stock markets. “We want to shift into markets where Sri Lanka was about half a decade ago,” he explained further.
CALH is currently focused on acquiring an existing fully licensed capital market service provider in Kenya that holds an investment banking license, stockbroking license, and primary dealing license. If a fully-fledged capital market service provider is not available, CALH will consider acquiring companies engaged in one or more of these services and subsequently pursue the other necessary licenses.
The company will list 7.6 per cent of its stake, equivalent to 157.5 million shares, on the Main Board of the Colombo Stock Exchange (CSE), with the shares offered at Rs.10 each, representing a 21 per cent discount compared to its September valuation of Rs.24 billion. Following the IPO, the company’s market capitalisation is projected to reach Rs.20.7 billion.
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