Sri Lanka’s LOLC Prepares to Sell Its Biggest Overseas Unit

LOLC plans to sell Cambodia unit to raise funds to expand. LOLC may seek strategic investor for Singapore holding firm.

LOLC Holdings Plc, Sri Lanka’s second-largest publicly traded company by revenue, plans to sell its stake in a unit in Cambodia and use the proceeds to fund acquisition of microfinance firms in emerging markets from Brazil to India.

LOLC Holdings plans to sell its 70% stake in Prasac Microfinance Institution Ltd., which also counts Hong Kong’s Bank of East Asia Ltd. as a shareholder, LOLC’s Deputy Chairman Ishara Nanayakkara said. He declined to disclose pricing details.

“It is very large as a micro finance institution. I think Prasac needs to move to a bank,” Nanayakkara, 46, said in an interview at LOLC’s headquarters in Colombo. The company’s 30% return on equity in Cambodia, which has a largely dollarized economy, makes it attractive, he said.

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