British fund plans Sh81bn investments in Kenya

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british

From left: Mike Foster, Economic Counsellor British High Commission, Nick O’Donohoe, CEO British International Investment, Jane Marriott, UK High Commissioner to Kenya and Seema Dhanani CEO Kenya- British International Investment. PHOTO | POOL

Kenya’s private firms could get investments amounting to Sh81.4 billion ($700 million) over the next five years from British International Investment (BII), which previously traded as CDC Group.

BII has pledged investments worth $7.5 billion (Sh873 billion) in Africa and the fund’s chief executive Nick O’Donhoe says Kenya has the potential of taking up 10 percent of the capital commitment going by previous investment trends.

“Kenya’s $500 million is about 10 percent of our current portfolio, so if you look at the $7.5 billion that I mentioned, it would be disappointing if we did not do a $700 million investment in Kenya over the next few years,” Mr O’Donhoe said.

The British fund has rebranded from CDC as part of its new strategy to identify with the UK and shift towards climate finance and the digital space.

BII makes the investments directly or through private equity funds to which it contributes the pooled capital.

Currently, the fund has a portfolio of about $500 million (Sh58.2 billion) in Kenya, including infrastructure, financial services, and logistics.

Its outstanding investments include stakes in or loans to companies like Equity Bank Kenya, Akiira Geothermal, Athi River Steel Plant, Cellulant Corporation, Equity Bank Kenya, Garden City, Grain Bulk Handlers, I&M Group and Kensta Group.

Its latest investments include the partnership with Safaricom in the Ethiopian venture and Globeleq’s 52 Megawatt Peak (MWp) Malindi Solar Plant that began supplying electricity to the national grid last December.

Mr O’Donhoe said the fund wants to grow its climate finance portfolio beyond just generation through wind and solar but also activities that go into transitioning into a green economy like battery storage and green hydrogen, electric vehicles and e-mobility.

“We have made a commitment to have 30 percent of our investment in climate finance and that would include big utility scale solar and wind which we have already invested close to a billion dollars over the last three or four years,” Mr O’Donhoe said.

BII will also fund private businesses in the technology and digital economy space. It has already invested in Liquid Telecom, helping the firm build data centres in the region.

Mr O’Donhoe said in the next phase BII will focus on the other side of the digital economy by supporting young entrepreneurs and venture capital to scale ICT-led businesses in the country.

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