Maruhan Japan Bank buys stake in MFI

Maruhan Japan Bank yesterday became the first commercial bank in Cambodia to make a direct equity investment into a microfinance institution by becoming Sathapana’s majority shareholder, with a 95.1 per cent stake. 

Financial details were not disclosed.

The shareholders who sold out to Maruhan were FMO, the international development bank of the Netherlands; Developing World Markets, a US-based asset manager specialising in microfinance investment; Tridos, the Netherlands-based global impact investor, Sathapana Employee Investment Limited and founding share holder; Cambodia Community Building NGO, according to a press release.

The primary rationale behind the exit of these stakeholders was due to Sathapana achieving its objective of increasing access to finance for poor and rural communities, reaching a level of maturity that would make it attractive to a private sector financial institution to step in as a majority shareholder.

At this early stage of the acquisition, Maruhan’s general manager, Shizuo Onishi, said, the move is in line with the bank’s goal of developing Cambodia, and right now its position as the majority shareholder is philanthropic.

“In Maruhan’s view, the short- to mid-term goals are purely altruistic,” he said. “We’re doing this because we want to help develop Cambodia and in the short term, microfinance will be the key to that.”

However, the long-term goals for the acquisition do have monetary gains in mind. 

“Our philosophy is that to generate profit in the future, we need to invest now,” said Onishi. “And so, we do expect in the long-term to make profits.”

In commenting on what piqued Maruhan’s interest in Sathapana, Chang-woo Han, chairman at Maruhan said: “We saw in Sathapana a pioneering company, with a strong business model and highly accomplished management team.”

According to the press release, Maruhan and Sathapana will continue to function as separate entities with the management structure of Sathapana remaining largely unchanged. Bun Mony, acting CEO of Sathapan said: “The investment that Maruhan will make in Sathapana will strengthen and enable us to reach goals previously beyond our capacity.”