SDB records another oversubscription at its SPO

Sanasa Development Bank (SDB) has concluded its secondary public offering (SPO) with an oversubscription of the initial issue of Rs. 3.5 billion, making SDB Sri Lanka’s first CSE-listed entity to host and complete a rights issue digitally, with an oversubscription, according to the bank.

“This SPO, through which we invited existing and new shareholders to join hands with the bank, was conducted to raise capital to activate several of the bank’s plans to empower communities most in need of support, whilst upholding our profitability to do what’s right by our shareholders. Two oversubscriptions during a pandemic is a lot to ask for, and we are truly grateful to each and every investor who has joined us in our journey of uplifting Sri Lanka’s rural sector and small and medium enterprises (SMEs),” said SDB CEO Thilak Piyadigama.

The capital raised from the SPO is to be used for the bank’s growth plan for the next three to four years, which includes growing its loan portfolio targeting SMEs and female entrepreneurship while providing digital banking services to rural areas.

The SPO targeted to initially issue up to 68 million new ordinary voting shares to the public at a share price of Rs. 51.50 to raise up to Rs. 3.5 billion, and in the event of an oversubscription of the initial issue, up to an additional 20 million shares via a greenshoe option, bringing the total value of the SPO to Rs. 4.5 billion. This offering was the second phase of the bank’s plans to power its growth trajectory, the first of which was its rights issue last year when it raised Rs. 1.5 billion.

Over the recent years, the bank has attracted institutional investors with an ethos of sustainability, MSME development, and capacity enhancement. During the private placement of shares of the bank in 2017, SBI FMO Emerging Asia Financial Sector Fund (SBI), International Finance Corporation (IFC), and Nederlandse Financierings Maatschappij Voor Ontwikkelingslanden N.V (FMO) invested Rs.1.46 billion in the bank. This SPO has witnessed the support of ICONIC Property Twenty-Three (Pvt.) Ltd., which is a fully owned subsidiary of LOLC Holdings PLC, FMO; Ayenka Holdings (Pvt.) Ltd.; and Belgian Investment Company for Developing Countries (BIO) partnering with the bank as shareholders.