MFS Capital Partners Limited (MFS), formerly SSL Venture Capital Limited (SSLVC), recently signed a memorandum of understanding (MOU) with the shareholders of Micro Financing Solutions Limited to acquire 100 per cent of its shares.

Following MFS’s purchase of Stocks and Securities Limited (SSL) earlier this year when MFS Acquisitions Limited — a special purpose vehicle — was created to acquire approximately 79 per cent of the shares of SSLVC, the new board of the rebranded entity had indicated that it would be working to refine the business model while undertaking a number of acquisitions, a few of which they were looking to close on this year.

MFS, which operates as a private equity firm, said that its decision to buy into Micro Financing Solutions is in keeping with its plan to fully acquire or take positions in mature companies possessing strong growth potential. This, as it positions to become a dominant player in the Caribbean financial sector.

At the company’s annual general meeting (AGM) this week chief executive officer (CEO) of MFS Dino Hinds, who also has affiliation with Micro Financing Solutions as a board member, touted the pending acquisition of the company as “a significant first addition” to MFS, which continues to execute on a strategy “to target companies involved in money services, investment banking, and real estate that show robust growth potential.

“We have outlined companies that we are interested in which are companies generating strong revenues and have the potential for significant growth and, therefore, the company [Micro Financing Solutions] met that criteria which is why we are going after it, as we are not interested in start-ups or companies in their earlier stage of development but ones that are more established.

“Therefore, any other company that we go after must fit in terms of our strategic plans,” he told the Jamaica Observer on Thursday.

“We look forward to completing this deal, while continuing our due diligence on other prospects in our pipeline,” he also told shareholders at the AGM on Tuesday.

The transaction, once completed, is to mark the first major deal executed since the new management and will see Micro Financing Solutions becoming the sole operating entity in MFS’s portfolio. Following completion of the transaction, the assets of Micro Financing Solutions is to be consolidated with that of MFS. The deal is expected to be settled in 90 days subject to pricing negotiations and regulatory approval.

MFS at the end of its first quarter ended September reported revenues of $12.5 million accompanied by profits of $5.3 million resulting from receivable financing revenues. Total assets amounted to $72.6 million at the end of the three-month period, up from $14.2 million for the year ended June 2022. This, after securing funds of some $24 million due from a related party and from increased cash and bank balances which climbed to almost $40 million.

Micro Financing Solutions, led by CEO Tamar Webley, holds equity position in a number of other entities and is currently a sub-agent of Lasco Moneygram and Western Union.

Speaking to the plans for other acquisitions, Hinds said that deep negotiations were now underway with hopes for more entities fitting the criteria to be added from its active pipeline of potential companies.

“We are really excited about the future and the way forward and we are determined that we will become the premier private equity firm in the Caribbean.

“We have about 15 companies that we are looking at, in terms of acquisitions, and which we are in negotiations, and as we go through the process we are hopeful that we will close on a number of them. We are down the road with some more than others, so we are, therefore, expecting that by the first quarter of 2023 it will be really exciting and busy for us as we look to close on some of our targets,” Hinds further said to the Caribbean Business Report.