Online credit marketplace RainFin will sell its corporate debt marketplace to 4 Africa Exchange (4AX) in exchange for a strategic shareholding in 4AX.
The collective value proposition is well positioned to deepen South Africa’s sophisticated debt capital market and expand on the growing sophistication of Africa’s debt and loan markets, 4AX CEO Fay Mukaddam said in a statement on Tuesday.
“It is a long-standing fact that the debt market is inadequately serviced, a problem that is not isolated to South Africa. The conclusion of this transaction will allow 4AX to build on the concept of crowdfunding, and a credit marketplace platform pioneered by RainFin, and significantly enhance that by bringing the offerings into a regulated world through alignment of the debt instruments issued by the RainFin platform and our listed regulated exchange,” she said.
The new debt listing offering will launch in the third quarter of this year.
RainFin CEO Sean Emery added that there was growing market demand for companies to have the tools to raise debt directly from the market.
“In essence, this would include technology-led self-origination, cost-effective arranging, bookbuilding and private placement and supply expansion.”
Beyond meeting immediate market needs, 4AX’s debt listing requirements position its debt division to meet growing market demand for high-yielding African market alternative debt products as an alternative to the Eurobond market.
“We are focused on offering a real alternative for corporate, treasury and other debt instruments and products. We also aim to build on this success by expanding our solutions and footprint into other regions in the future – and continue to contribute to the deepening of emerging capital markets across Africa,” Mukaddam said.