LeapFrog Investments, an African and Asia-focused financial services investor, has acquired a 25 percent stake in one of Ghana’s largest pension firm, Petra Trust with the expectation of quadrupling growth in the next four years.
The development represents LeapFrog’s first investment in Africa’s pensions sector, which is forecast to grow 400 percent in the next four years following liberalisation of the pensions market, Ekow Fynn-Aikins, a regulations officer with the National Pension Regulatory Authority Accra, said.
Much of this growth is likely to be propelled by the rapid expansion of Africa’s emerging consumer sector, as more households grow into the middle class, a statement released by the company said.
Doug Lacey, a partner at LeapFrog Ghana said that the fresh capital injected by the company into the local insurer will be used to invest in infrastructure, upgrade systems and expand beyond Accra to other parts of the country.
Although Lacey pointed out that it was too soon to say how long LeapFrog would retain investment in Petra, he however noted that the “opportunities in Ghana are enormous as it’s a nascent industry.”
“We look forward to providing support both on the board and operationally to further accelerate Petra’s growth, profitability and impact,” he added.
Cofounded by Kofi Fynn, Chris Hammond and Helena Pokuin in late 2011, Petra Trust is one of Ghana’s largest pension-trustee companies. It serves a local market of 20-million consumers in the informal and semi-formal sectors, which account for some 90 percent of Ghanaian employees.
“Petra will be able to invest in expanding infrastructure to better serve existing clients and grow our market reach, while boosting Ghana’s pension industry,” Kofi Fynn said.
“Pension reform was introduced to ensure that the previously unserved would also have a chance to invest for their future, and that is exactly the service we have been called to provide. We see the pensions industry growing fast in Africa and are very excited about the growth of the micro pension sector,” he added.
