MFS Capital Acquires Micro-Finance Solutions for $500 Million

MFS Capital Partners Limited, a company currently in the process of transforming itself into a financial services firm, has set a goal of achieving $1 billion in annual sales within two years.

MFS Capital CEO Dino Hinds also said the company aims for about a fifth of its revenue to go to net income as profit.

The company, formerly known as SSL Ventures before its ownership change, would essentially start from scratch as a business with zero revenue and steadily increasing losses.

The path to achieving the billion-dollar goal has been paved by acquisitions, the first of which was Micro-Finance Solutions Limited.

The transaction has been a long process in the making, but MFS Capital says the 100% purchase of MFS Limited was completed on March 29, 2024, “at a discounted price of $500 million.”

“The valuation resulted in an unrealized fair value gain of $287.27 million,” the company said in its third-quarter earnings report.

It also reported that MFS had a book value of just under $217 million.

The new purchase increased MFS Capital’s total assets from $65 million to $864 million, and its book value from negative equity of $2.4 million to positive $255 million. The company also became more indebted, with $500 million of its $603 million in long-term debt consisting of new loans from MFS Acquisition, the entity used to acquire SSL Ventures.

“With the first phase of pipeline acquisition work now complete, we are now in the process of implementation,” Hinds said.

“We’re very confident in a couple of the companies we’re working on. I can tell you we’re very close to signing some of those deals,” he said, adding that another announcement would come in about two months.

For the nine months ending March 2024, MFS Capital reported revenue of $493,000, of which $132,500 was earned in the third quarter. And the company’s losses rose to $34 million, almost half of which were incurred in the third quarter.

“Our results will be significantly better in the fourth quarter when we have one full quarter of operations with the acquired business, which is our first portfolio company,” Hinds said.

“These numbers will show the portfolio company’s revenues,” he said.

Commenting on the future of MFS Capital, Hinds said the group and its member companies would operate on a shared services model.

“For similar services, there will be a department within the holding company that will handle issues such as human resources, marketing, etc.,” he said.

The five-member MFS Capital board was scheduled to retreat on Thursday, July 4, but Hurricane Beryl delayed the meeting. The board will instead meet on July 11.

“After this retreat, we will move on to specific numbers. The board will also approve goals for executives and business development staff,” he said.

Hinds confirmed that MFS Capital is no longer involved in or interested in microlending.

“To be clear, we are not doing microfinance. We are looking at money services, so money transfers and cambio services,” he said.

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