By Rukayat Moisemhe
Sage Grey Finance Ltd. has advocated manufacturing value-chain financing as a strategy to strengthen businesses and support growth.
The company also announced plans to obtain a commercial banking licence and list on the Nigerian Exchange Group (NGX).
Mr Temitope Runsewe, Managing Director of Sage Grey Finance Ltd., said this at the company’s 10th anniversary news conference on Thursday in Lagos.
According to Runsewe, value-chain financing allows financial institutions to support entire business ecosystems, including suppliers, distributors and other partners, not just individual firms.
He said the company’s “captive gateway strategy” involved targeting businesses linked to many others, enabling it to finance multiple companies within a chain.
“We can fund you, and fund everybody in your value chain.
“The approach will help businesses focus on their core operations while complementary companies provide specialised services such as power, security, logistics and other critical infrastructure,” he said.
He added that the model was particularly relevant to Nigeria, where businesses often had to provide several services themselves because the required infrastructure and support systems were not available at sufficient scale.
Runsewe said manufacturers, for instance, could benefit from partnerships with specialised providers of power, security, logistics and intermediate products rather than attempting to handle every aspect of their operations.
He also called for increased access to long-term capital for manufacturers, citing high energy costs, inadequate infrastructure, security challenges, shortage of skilled personnel and increased cost of imported inputs among the constraints facing the sector.
Runsewe, however, said currency depreciation, while increasing the cost of imported inputs, could make Nigerian products more competitive in international markets.
“While the currency issue makes some input materials more expensive, it also makes your products cheaper in the international market,” he said.
Speaking on growth plans, Runsewe said the company was working toward upgrading its finance company licence to a commercial banking licence.
He said the proposed commercial banking licence would enable the company to provide more services and mobilise greater capital for its stakeholders.
He added that the company also planned to access the capital market through an NGX listing.
“We know that the stock exchange is the optimal place for you to raise capital,” he said.
According to him, raising capital locally to fund local operations would create a more sustainable structure for the company’s expansion.
Runsewe said the company had spent its first 10 years building its people, processes, governance and infrastructure to support its next phase of growth.
He said Sage Grey currently operated from four locations, including three in Lagos, and had invested substantially in technology and customer support infrastructure.
The managing director said the company began operations in 2016 as a corporate finance advisory firm but had evolved into a diversified group with interests in financial services, technology, investment management, energy services and manufacturing.
He said its exposure to different sides of the business ecosystem, including equity investment, debt financing and business operations, gave it a broader understanding of the challenges facing businesses.
Runsewe said the company was also committed to supporting Micro, Small and Medium Enterprises (MSMEs).
He added that the company is one of the partners of the Bank of Industry on Federal Government SME funds, through which it currently provides financing at nine per cent.
He said the company had also established a circular economy impact fund with partners, targeted at businesses operating in Nigeria’s circular economy space.
He added that Sage Grey had institutionalised its Environmental, Social and Governance (ESG) activities at board level and planned to establish a foundation to coordinate its social impact initiatives.
Runsewe said the company’s first 10 years had been focused on building a strong foundation, while the next decade will be driven by greater scale, increased impact, a commercial banking licence and expanded access to capital.(NAN)
ARM/FAA
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Edited by Folasade Adeniran