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November 24, 2022

MUFG to acquire two Asia units of Home Credit for €596m

Mitsubishi UFJ Financial Group (Mufg ) and MUFG Bank have announced the acquisition of 100% shares of HC Consumer Finance Philippines (HC Philippines) and 85% shares of PT Home Credit Indonesia (HC Indonesia) for €596m (JPY87bn).

HC Philippines and HC Indonesia are subsidiaries of Home Credit (HC).

This acquisition is being made through MUFG Bank and its consolidated subsidiaries Bank of Ayudhya Public Company Limited and PT. Adira Dinamika Multi Finance.

Bank of Ayudhya Public Company Limited or Krungsri is a commercial bank in Thailand, while PT. Adira Dinamika Multi Finance (ADMF) is a finance company in Indonesia.

Following the receipt of approvals from the relevant regulatory authorities, the deal is expected to be completed within 2023.

Based in the Netherlands, HC is a consumer finance company engaged in consumer lending, primarily in POS loans.

It is controlled by the Czech Republic-based investment group PPF.

HC Philippines and HC Indonesia have brand recognition and hold dominant market shares in terms of POS loans in both the countries. Their app has been downloaded 20 million times in the two countries, and have a total 13 million loan customers.

For MUFG, which has presence in the Philippines and Indonesia through investments in its equity method affiliate Security Bank Corporation and consolidated subsidiary PT Bank Danamon Indonesia Tbk, this deal represents an expansion of its retail business in both countries.

Following the completion of the acquisition, Krungsri will hold 75% of the shares of HC Philippines and 75% of the shares of HC Indonesia, MUFG Bank will hold 25% stake in HC Philippines, and ADMF will hold 10% interest in HC Indonesia.

MUFG and MUFG Bank intend to bolster their business in Southeast Asia with the establishment of business platforms in collaboration with partner banks in which MUFG bank has invested.

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