CapitalSage Technology Limited has successfully tapped into the Commercial Paper (CP) market, raising a substantial sum of N7.50 billion through the issuance of series 7 and 8 commercial papers under its N15 billion Commercial Paper programme.
The Commercial Papers offering, which commenced on January 30, 2024, concluded on February 8, 2024.
Capitalsage, an integrated digital financial services group, aims to provide inclusive solutions for individuals and businesses, fostering sustainable value and wealth creation in Africa.
The series 7 of the Naira-denominated Commercial Paper (CP) has a tenor of 182 days with a discounted rate of 17.7763 percent, while the series 8 CP is tenored for 270 days with a discounted rate of 18.1831 percent.
The proceeds from this issuance will be directed towards financing short-term working capital requirements for CapitalSage’s digital banking business. Both Agusto &Co and GCR have rated CapitalSage favorably, with ratings of Bbb+ (short-term) and Bbb (Short-term) respectively.
CapitalSage’s strategic vision is to become the leading fintech partner in Africa, promoting financial inclusion and entrepreneurial development through innovative technology solutions.
Approximately 90 percent of CapitalSage’s revenue is derived from transaction fees generated by its extensive network of over 50,000 POS agents across Nigeria. The company’s payment services, offered under the Kolomoni brand, cater to underserved areas lacking commercial banking infrastructure.
In pursuit of its digital payments and collections objectives, CapitalSage acquired Cintrust Microfinance Bank in 2021 and Ercas Integrated Payment Solutions, a CBN-licensed Payment Solution Service Provider (PSSP), in 2022. Additionally, it launched Kolomoni Microfinance Company Gambia, its Gambian subsidiary, in May 2023.
Meristem Wealth Management Limited, in its Commercial Paper recommendation note, affirmed CapitalSage’s relatively stable liquidity position and moderate leverage usage. The company has demonstrated steady revenue growth over the last five years, recording a compound annual growth rate (CAGR) of 213.66 percent, with revenues reaching N30.36 billion in full year 2023.
CapitalSage’s prudent cost management practices have led to improved profitability, reflected in its profit after tax (PAT) advancing by 52.17 percent to N6.65 billion in 2023FY. Furthermore, the company’s strong balance sheet metrics, including positive working capital and improved liquidity ratios, underscore its financial resilience and operational efficiency.
Looking ahead, CapitalSage is poised to leverage the proceeds from its recent CP issuance to drive further growth initiatives, including the acquisition of additional POS terminals and working capital expansion.
