Cordiant inks first deal with fourth fund

The group, led by David Creighton, held a first close for CELF IV earlier this year on $250m and has now begun deploying capital.

Emerging markets debt specialist Cordiant made the first investment from its latest fund, providing $55m to a Sri Lankan leasing business.

The loan, made to Lanka Orix Micro Credit (LOMC), was made in partnership with Dutch Development bank FMO. It is the first deal using capital from Cordiant’s CELF IV fund, which held a first close on $250 million in April this year.

LOMC specialises in leasing light trucks and agricultural equipment and issuing microfinance loans. It fills a significant lending void created by Sri Lanka’s underdeveloped banking sector, Cordiant said in a statement.

The company’s lending portfolio is entirely backed by foreign funders, in keeping with Cordiant’s approach of targeting investments that already have support from development finance institutions and other institutional backers.

Cordiant’s loan will be used to help finance growth in the company's micro-leasing and group lending portfolio.

David Creighton, president and chief executive of Cordiant, said in the statement: “Leasing is a rapidly developing sector of the finance industry in emerging markets, as it excels at getting funding to fast-growing SMEs. LOMC has an excellent reputation in this sector nationwide, and is at the forefront of its expansion. Sri Lanka’s economy is forecast to grow at over 6.5 percent per annum by the IMF. That’s comfortably in excess of average growth rates for emerging markets.”