Aquila Leasing

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In Nigeria, like in most African countries, leasing companies start to play a vital role in the expansion of financial markets and SMEs. Aquila Leasing is one of the two only sizeable and well-established leasing companies in the country. Its core business consists of financial leasing targeting SMEs and consumers (individuals, professionals, traders/craftsmen) in specific sectors for which Aquila developed a particular marketing positioning.  In addition, Aquila provides short term working capital financing (less than one year) to SMEs and private professionals, but this activity should remain minor (capped at 10% of the resource allocation).

Aquila Capital started its operations mid-2005 as a non-bank financial institution providing financial leasing solutions and asset management services to SMEs and individuals.  Local banks are the major source of financing for the company but they do not provide long term financing. Early 2008, Africinvest I and AfricInvest Financial Sector (AFS), two private equity funds decided to invest in the company to support Aquila Capital’s development. They also provided technical assistance to improve its corporate governance, commercial strategy and financial management.

Aquila being in a transition phase to become a leasing company managed under professional standards, and still in need for long term funding to face the expected boom of the Nigerian market, BIO recently took the decision to support the company’s expansion plans. BIO’s long term debt financing (USD 5 million) will help Aquila Leasing in reaching a critical size and becoming the new leader in the market, thus improving confidence from local banks and local private investors.  This way the company will be able to attain easier access to capital markets and bank financing at more attractive conditions.

In terms of development impact, this investment will add to the reinforcement of the financial sector in Nigeria, and more specifically the non-bank financial sector, as local banks do not take up the role of SME financing. It will be mainly on-lent by Aquila to specific clients with an export activity and USD driven revenues. By offering financial services to the SME sector, Aquila Capital is expected to significantly contribute to assets and employment creation, poverty reduction, and sustainable economic development.

Find out more about BIO's technical assistance subsidy to Aquila Leasing here.

In 2015, BIO invested another EUR 4 million into Aquila Leasing to grow its SME and associations & cooperatives finance lease portfolio.

Website : www.aquilacapitalltd.com

  • Investment amount (€):

    $5M; €4M

  • Contract signature :

    2010; 2015

  • Nature of intervention :

    Debt

  • Development impacts :

    • 1 — Reinforcement of the financial sector
    • 2 — Improving access to long term financing by SMEs
    • 3 — Job creation

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