In a notable development for Pakistan’s financial industry, MNT–Halan Pak B.V., a Dutch-Egyptian player in the financial market, has obtained approval from the Competition Commission of Pakistan (CCP) to acquire Advans Pakistan Microfinance Bank Limited.
The acquisition process commenced with a share purchase agreement between the companies in August 2023, gaining momentum with subsequent approval from the State Bank of Pakistan (SBP) in October 2023. The final step required clearance from the CCP and meeting certain conditions precedent, both of which have now been satisfied.
Based in the Netherlands, MNT–Halan Pak B.V. operates in Pakistan through its subsidiaries, Halan Wallet (Private) Limited and Halan Finance Limited. Formed through collaboration between Dutch microlending firm MNT and Egyptian fintech startup Halan, the company aims to transform digital lending and payments transactions.
In February 2023, MNT-Halan secured up to $400 million to support global expansion plans, with its valuation expected to surpass $1 billion with the new investment.
Advans Pakistan Microfinance Bank Limited, the acquisition target, represents the Pakistani arm of the esteemed Advans Group, a prominent international microfinance group operating in nine developing countries.
Established in 2012 with approval from the State Bank of Pakistan to operate as a microfinance bank in Sindh province, Advans Pakistan Microfinance Bank Limited focuses on providing microfinance banking services to underserved segments, aligning with the Microfinance Institutions Ordinance, 2001.
Despite its noble objectives, APMBL has encountered challenges in Pakistan’s microfinance market, reporting consecutive losses in recent years. With accumulated losses exceeding Rs 1.3 billion as of September 2023, Advans Pakistan had become financially burdensome for the Advans group.
The acquisition entails purchasing 100% of Advans Pakistan Microfinance Bank Limited from Advans S.A. SICAR, a Luxembourg-based financial services firm. Following a comprehensive review, the CCP determined that there are no overlaps between the merging entities, ensuring market stability post-acquisition.
This acquisition carries significant implications for Pakistan’s microfinance banking sector, underscoring MNT–Halan’s dedication to enhancing financial inclusion and innovation in the region. With microfinance institutions playing a crucial role in extending financial services to marginalized communities and contributing significantly to agricultural advances, this move is expected to stimulate growth and resilience in the sector.
Source: Innovation Village