Oikocredit launches a new capital-raising model
OIKOCREDIT, Ecumenical Development Cooperative Society U.A. (Oikocredit) has launched its new capital-raising model, which is going to allow any eligible organisations and individuals to invest directly in the cooperative.
Investors across countries where Oikocredit offers the opportunity to invest will be able to buy, hold and sell the same investment product which is a non-voting equity instrument called a participation.
Participations are available to eligible investors and organisations in Germany and to members of the cooperative. Participations will become available to other investor groups in phases.
Eventually participations will completely replace both the shares that Oikocredit previously issued only to cooperative members, and the other investment products that are derived from such member shares and issued by Oikocredit’s support associations and Stichting Oikocredit International Share Foundation (OISF).
Efficient, resilient and impactful model
The introduction of participations is intended to result in a simpler and direct way for individuals and organisations to invest in Oikocredit.
By offering a single product (i.e. the participation), Oikocredit’s capital-raising is expected to become more efficient. This will allow the cooperative to use more resources in partnerships and projects that benefit low-income communities, and in promoting sustainable development together with its global network of investors, members and partners.
Changes begin on 1 March 2023
Oikocredit has effectuated an amendment to its articles of association on 1 March 2023 and has begun implementing the new model with the gradual conversion of its outstanding member shares into participations. This means that for all investment products derived from member shares and issued by Oikocredit’s support associations and OISF, the underlying product will change from a member share to a participation.
Members of Oikocredit and investors in Germany are now able to invest directly in participations, with other investor groups following in the months thereafter. Amidst this change to participations, members continue to stay a member of the cooperative and hold voting rights in the cooperative.
Support associations stand strong amidst changes
With the introduction of participations, investors will no longer invest via the support associations and OISF. However, the support associations will continue to promote Oikocredit’s mission in their regions, nurture local communities of investors and inform them about the work of Oikocredit and its partners. They will also continue promoting education on sustainable development together with Oikocredit and serve as the voice of their members.
Oikocredit’s members and investors are recommended to familiarise themselves with the articles of association, the participations terms and the prospectus.