Private equity firms have invested about $1 billion in Kenyan companies in the first eight months of this year, almost ten-fold what was declared in the same period last year, Burbidge Capital showed in a new report.
Businesses in the largest East African economy have monopolized deals, mostly in the financial sector, in the region, accounting for 18 deals out of 25 investments that PE firms have made between January and August.
“Favourable demographic dynamics, stable macroeconomic fundamentals, technology-driven products, increase in disposable income and structural gaps in supply and demand have created attractive investment opportunities in the financial services sector,” Business Daily quoted Burbidge Capital saying in a report.
Top investment in Kenya include a recent stake change in Equity Bank, the country’s largest bank by customers, that saw Helios Partners sell its 24.9 percent stake in the bank to Norwegian funds Norfund and NorFinance at an estimated $219 million.
Other investment included Old Mutual’s purchase of a controlling stake in Kenyan insurance firm UAP Holdings, investment partnership deal between real-estate firm AMS Properties, HassConsult and Mauritius-based PE firm Xterra Capital Advisors, China’s Avic investment in Centum’s Two Rivers developments, among others.
In the first eight months of 2014 only $150 million had been declared as invested by PE firms in Kenya, although several other deals were not valued.
Foreign direct inflows into Kenya reached $98 million in 2014, almost double the amount that was invested in 2013, according to the United Nations Conference on Trade and Development (UNCTAD) World Investment Report.