MUFG to acquire Home Credit’s subsidiaries in Philippines and Indonesia
Japan’s Mitsubishi UFJ Financial Group (MUFG) and MUFG Bank have agreed to buy 100% of HC Consumer Finance Philippines (HC Philippines) and 85% of the shares of Home Credit Indonesia (HC Indonesia), both subsidiaries of Home Credit (HC) for around €596 million (nearly ¥87 billion).
The acquisition is part of MUFG and MUFG Bank’s strategy to improve their business in Southeast Asia through the creation of business platforms in the region in association with partner banks in which MUFG bank has invested.
The transaction is expected to help MUFG further cement and expand its retail business in the Philippines and Indonesia.
The acquisition will be executed through MUFG Bank and its subsidiaries — Thailand-based Bank of Ayudhya Public (Krungsri) and Indonesian finance company PT. Adira Dinamika Multi Finance (ADMF).
Home Credit, which is headquartered in the Netherlands, is a consumer finance company involved in consumer lending, mostly in point of sales (POS) loans.
HC Consumer Finance Philippines and Home Credit Indonesia have a combined 13 million loan customers and are said to have dominant market shares as far as POS loans in both countries are concerned. Besides, their app is claimed to have been downloaded 20 million times in the Philippines and Indonesia.
Post-closing, Krungsri and MUFG Bank will hold 75% and 25% shares, respectively, in HC Consumer Finance Philippines.
In Home Credit Indonesia, Krungsri and ADMF will hold 75% and 10% shares, respectively.
Subject to regulatory authorities’ approval, the transaction is anticipated to be completed within 2023.
MUFG already has presence in the Philippines and Indonesia via Security Bank Corporation and Bank Danamon Indonesia.