MICROCAPITAL BRIEF: Nordic Microfinance Initiative Raises $5m from Lauritzen Fonden to Invest in Women in Africa, Asia

Denmark-based Lauritzen Fonden recently invested USD 5 million in “Fund IV” of the Nordic Microfinance Initiative (NMI), a Norway-based public-private partnership that invests in microfinance institutions and agricultural initiatives in developing countries. The new investment is specific to microfinance, mainly for women in Africa and Asia.

Lauritzen describes itself as a “commercial foundation.” It earns income from shipping concerns and investments in real estate, technology, software and equipment and then disburses approximately DKK 40 million (USD 6 million) per year to support youth and other nonprofit endeavors.

Tommy Thomsen, CEO of Lauritzen, said “At Lauritzen Fonden, we find it important to try new things, both in relation to potential business opportunities and ways to remedy unsuitable conditions in society. We therefore look forward to the cooperation with NMI, where we with an investment in financial inclusion strengthen our social impact and hopefully contribute to sustainable social change beyond Denmark’s borders.” The investment is Lauritzen’s first in the financial inclusion sector in poor countries.

Arthur Sletteberg, Managing Director of NMI, said Lauritzen “has a strong social commitment that is well in line with NMI’s values. The investment is also strategically important to us, as it underlines the public-private and Danish-Norwegian partnership in NMI.”

NMI was founded in 2008 with the goal of creating jobs and wealth via financial inclusion. It is owned by several private entities and two government-backed institutions, Norway’s Norfund and the Danish Investment Fund for Developing Countries, which is known by its Danish acronym IFU. NMI’s five funds hold aggregate assets of USD 280 million as of 2020, including 18 direct investments in six countries that reach 9 million people, of whom 90 percent are women. The funds have also placed a total of seven investments in other microfinance investment vehicles. In addition to four microfinance funds, NMI manages the Climate Smart Fund, which offers “attractive loans and agricultural assistance [to help] Indonesian smallholders intensify work on their existing plots instead of clearing rainforest.” NMI reports a history of generating returns to investors of 3 percent to 5 percent per year.

Established in 1945, Lauritzen has total equity of DKK 5.9 billion (USD 890 million) as of 2019.

By Simrun Kothari, Research Associate

Sources and Additional Resources

Direct contact with NMI

Lauritzen homepage
https://lauritzenfonden.com/

Lauritzen financials
https://lauritzenfonden.com/en/about-us/key-figures-2019/

More MicroCapital news on NMI
https://www.microcapital.org/microcapital-brief-sindhuja-microcredit-of-india-raises-8-7m-in-equity-sale-to-carpediem-capital-nordic-microfinance-initiative/

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