S&P Global said Tuesday it had acquired a majority stake in Lagos-based credit ratings agency Agusto & Co. to expand its presence in Africa’s domestic credit ratings market. The acquisition comes as African leaders and finance ministers argue the world’s leading credit ratings agencies overstate political and economic risks across the continent, raising borrowing costs and constraining economic growth.
Global ratings agency S&P said the investment would support the growth strategy of its African business, for which it currently depends primarily on its South African office. Agusto & Co., founded in 1992 by Nigerian economist Olabode Agusto, operates in Nigeria, Kenya, Ghana and Rwanda.
The deal is the first of its kind for the US-based S&P on the continent, although its subsidiary, S&P Global Commodity Insights, has an office in the Nigerian capital Abuja. Yann Le Pallec, president of S&P Global Ratings, said the acquisition will support “transparency in local credit markets” across Africa.
READ ALSO: Gov Eno Approves ₦31bn Economic Empowerment Programme For 165,912 A’Ibom Residents Yinka Adelekan, Agusto & Co. managing director, said the deal will support the development of “transparent and resilient credit markets across the continent”. Details of the transaction were not disclosed.
The transaction is expected to be closed in the second half of the year.