MICROCAPITAL BRIEF: Rent-to-Own Car Financier Planet42 of South Africa Secures Final Tranche of $13m Debt, Equity Package

Planet42, a car financier in South Africa, recently secured the closing portion of a funding package arranged by Verdant Capital, an African financial advisory firm, totaling USD 13 million in debt and equity. The names of the investors and the portion of equity sold have not been released.

Planet42 provides a “rent-to-buy” service for automobiles, serving “the financially excluded… people ignored by banks… due to overly strict lending criteria.” Clients obtain a vehicle, submit a monthly rental payment and are offered a buy-out price that declines over five years to ZAR 5,000 (USD 300). The firm manages risk through “an automated scoring algorithm and securing its assets [via] title deed, tracking technology [and] comprehensive and mechanical insurance.” As of 2020, Planet42 has financed 1,800 cars and reports annual turnover equivalent to USD 4 million.

Verdant, which has offices in the Democratic Republic of Congo, Ghana, Mauritius, Nigeria and South Africa, served as advisor on the transactions. Verdant provides capital raising and financial advisory services as well as assisting in mergers and acquisitions in Africa.

By Sai Bommineni, Research Associate

Sources and Additional Resources

Verdant Capital press release
https://verdant-cap.com/verdant-capital-completes-its-third-fintech-transaction-in-2020/

Planet42 homepage
https://planet42.com

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