Letshego investors approve P500m loan request to BPOPF
Mbongeni Mguni | Thursday August 14, 2025 18:48
A notice to the Botswana Stock Exchange this afternoon indicates that more than 99% of the shareholders present at an Extraordinary General Meeting convened for the transaction yesterday, voted in favour of the deal.
Under the terms of the transaction, the BPOPF would advance a Letshego P500 million loan with a tenure of 18 months. The loan would carry “market related cost of funds” in terms of interest and associated costs.
“Due to a combination of external economic pressures and internal operational challenges, the Company experienced liquidity challenges which posed a risk to the Group’s financial stability,” Letshego told shareholders in a circular on the loan ahead of the EGM.
“The company is actively pursuing alternative funding sources and believes that support from key shareholders will provide the most efficient and least disruptive solution at this critical time.”
The BPOPF is a major shareholder in Letshego, holding 37% of equity as at July 30, 2025.
The microlender’s directors said the BPOPF loan would provide immediate liquidity whilst long-term solutions are being finalised.
“The company has not been exempted from the liquidity challenges, which have been combined with internal challenges, including delays in subsidiary remittances, partly due to foreign currency market shortages, and in some instances, due to regulatory pressures, as well as lower than expected dividends driven by negative subsidiary financial performance for 2023 and 2024,” the directors said.
The local financial market is grappling with a liquidity crunch caused by reduced government spending amidst the prolonged diamond downturn.
The BPOPF recently said it aimed to increase investments in the local economy, both through support to entities it is already invested in as well as other deals being finalised in certain companies and the infrastructure sector.
For the pension fund, the Letshego loan is also an investment opportunity, particularly in a credit-rated entity backed by strong assets.