MICROCAPITAL BRIEF: Thailand-based Thitikorn Buying Microfinance Institution Myanmar Financial International Limited (MFIL)

Thai vehicle-finance firm Thitikorn recently secured agreement from the shareholders of Myanmar Financial International Limited (MFIL), a microfinance provider in Myanmar, to buy the company for no less than two times its audited book value. MFIL was established in 2014 by Singapore-based Myanmar Investments International (MIL); Myanmar Finance, whose microfinance business MFIL took over at its founding; and the Norwegian Investment Fund for Developing Countries (Norfund). MIL and Myanmar Finance each control a stake of 37.5 percent in MFIL while Norfund owns the remaining quarter.

MFIL issues loans to individuals and small businesses for terms of one to two years, in amounts up to USD 6,000. As of 2019, it has 71,500 borrowers and a loan portfolio of USD 14.6 million. The firm has 14 offices serving Yangon, Bago and Mon State.

MIL is listed on the Alternative Investment Market of the London Stock Exchange, and its first ever investment was in MFIL. That placement was made in 2014 in the amount of USD 2.3 million. In 2019, MIL began “to wind down its operations… [due] to difficulties in raising capital and identifying suitable investments in Myanmar, given the slow pace of reform in the country and continued economic volatility.”

Thitikorn operates 78 offices and holds assets valued at THB 9.16 billion (USD 280 million) as of 2019. It is listed on the Thailand Stock Exchange and had a market capitalisation of THB 3.57 billion (USD 110 million) as of April 10, 2020.

By Ng Chee Meng, Research Associate

Sources and Additional Resources

Deal Street Asia article on MFIL sale
https://www.dealstreetasia.com/stories/myanmar-investments-mfil-thitikorn-182817/

Financial Times article on MFIL
https://markets.ft.com/data/announce/detail?dockey=1323-14486133-10OK4I6LRLCIT32TUINI2DVCDM

MFIL homepage
https://www.mfil.net

MIL annual report 2019
https://myanmarinvestments.com/wp-content/uploads/2019/10/MIL-2019-Annual-Report.pdf

Financial Times article on MIL purchase on MFIL in 2014
https://markets.ft.com/data/announce/full?dockey=1323-13799249-6U7F1QS6IHE0EC9EMCNVHGH9EQ

Norfund press release on MFIL
https://www.norfund.no/app/uploads/2020/03/Press-Release-MFIL-Yoma-Nov-2015-PDF.pdf

Reuters company review of Thitikorn
https://www.reuters.com/companies/TK.BK

Thitikorn annual reports
https://market.sec.or.th/public/idisc/en/Viewmore/fs-norm?uniqueIDReference=0000004674&searchSymbol=TK

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