By Providence Obuh
First Funds Limited, a subsidiary of First Bank Plc, has invested N600 million as strategic equity investment in one of the nation’ leading operating and finance lease companies ,VT Leasing Limited.
Speaking in a statement by Managing Director, VT Leasing Ltd., Mr Akin Opeodu said the investment in VT Leasing was made using a mix of ordinary shares, preference shares and redeemable convertible note.
Through this investment, First Funds will acquire a 22.5% stake in VT Leasing, adding that this was done to reposition the company for greater performance and efficiency to serve its numerous customers across the country.
According to Opeodu, this equity investment was announced on Monday 30th August 2010 at a partnership signing ceremony held at the Victoria Island, Lagos office of VT Leasing.
“The objective of this investment is to position the company to go public in a few years as I have disclosed during the company’s 20th anniversary celebration last year.
This investment is a critical first step in achieving this goal, as the fund will be primarily focused on achieving the objectives of further expansion of the service portfolio to meet market demands, asset acquisition to satisfy growing customer needs, investment in IT leasing software and hardware as well as training & development of our human capital to ensure superior service delivery” He said.
Opeodu disclosed that apart from the financial capital investment, First Funds Ltd., will also be bringing on board, an irrefutable significant financial experience and expertise.
“This investment in VT Leasing is a demonstration of First Funds’ confidence in the leasing business in Nigeria as a whole and in the high potential of VT Leasing in particular.
He stated “The investment of N600million will raise the authorised share capital of VT Leasing from 600 million of 50k ordinary shares to 1 billion ordinary shares of 50k each. In spite of the global economic gloom, VT Leasing’s income for financial year 2009 stood at N 911 million, marking about 20% increase over 2008 income of N766 million”,.
The managing director stressed that the investment is a giant feat for VT Leasing.
The company, he said, is now poised to take advantage of all opportunities that are abound in the Nigerian leasing sector. The company will continue to grow through partnerships with all stakeholders and offer better service to her current and prospective customers for the mutual benefit of all.
In the same vein, the Managing Director First Funds Limited, Madam Yemisi Tayo-Aboaba said the investment in VT Leasing has demonstrated strong belief in the company.
, however She noted “Leasing in Nigeria has grown in volumes over the years with recent findings showing the industry as second to that of South Africa on the continent and the most rapid in terms of growth.
She said the industry has maintained an impressive steady growth within the past few years. with assets under lease rising from N115 billion in 2005 to N437 billion in 2009, a compounded annual growth rate of 40%. “
“We are delighted to be partnering with the market leader in its niche market of Fork Lift Trucks leases, with a reputation for delivering excellent service, the company is strategically positioned in an industry currently experiencing high growth” She said.
According to the statement, since her inception in 1989, VT Leasing has transformed from small ticket leasing company, servicing mostly individuals to a formidable operating and finance leasing company, providing forklift, trucks, buses, cars, specialised equipments and provision of technical operations personnel to a diverse customer base that include Nigerian Breweries Plc, Nigerian Bottling Company Plc, Cadbury Nigeria Plc, Nestlé Nigeria Plc, and Nigerite Plc.