Bamboo Finance, a private equity group that specializes in microfinance and social entrepreneurship financing, announced today that it has acquired a controlling interest in Accion Investments in Microfinance, SPC, a private, for-profit equity fund that has provided capital to microfinance institutions (MFIs) since 2003, in a $105 million deal.
Accion Investments was launched by Accion International, a global non-profit, as a for-profit entity to provide commercial capital to MFIs. Over a ten-year span, Accion Investments fund generated a 15.62 percent Internal Rate of Return to shareholders through impact investments.
Founded in 2007, Bamboo Finance operates around the world, manages a $250 million portfolio of direct investments, and has offices in Luxembourg, Geneva, Bogota, San Francisco, and Singapore. Through their Bamboo Financial Inclusion Fund, it has helped several microfinance organizations turn into full-fledge banks that provide for the lowest socio-economic segments.
Accion Investments has holdings in MFIs in Latin America, including Banco Popular of Honduras, Paraguay’s Banco Vision and Mibanco of Peru. These investments represent significant stakes in mature MFIs in the region.
Accion Investments’ less mature investments, primarily in sub-Saharan Africa, have been purchased jointly by Bamboo and Accion’s Gateway fund, and include shareholdings in Nigeria’s Accion Microfinance Bank; EB-Accion Savings & Loans in Ghana; and EB-Accion Microfinance in Cameroon.
“This transaction complements our portfolio of investments,” said Xavier Pierluca, Chief Investment Officer of Bamboo Finance. “We are excited to provide continuity to the project alongside Accion, and to further the financial inclusion work of MFIs that are positioned for solid growth well into the future. Many of these MFIs, as well as our current portfolio companies, have moved well beyond Microfinance 1.0, starting to offer micro-insurance and remittance services while still growing at a fast pace.”
Accion will continue to invest in MFIs as part of its overall strategy, which is centered on helping to build the next generation of top-tier MFIs, using impact investing to help push the frontiers of microfinance beyond MFIs, and on helping to build a stronger industry with high standards.
“When we launched the fund, 90 percent of its capital was public money,” said Enrique Ferraro, managing director of Accion Investments. “Today, 90 percent of it is private. That’s attributable to the fund’s return, which we believe is a significant achievement for socially-responsible investing. By attracting private capital to MFI funding, we furthered our vision of building a financially inclusive world.”
Source: Accion International
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