Britam’s plan to raise Sh5bn fresh capital gets green light

Investments firm Britam has received the nod to raise Sh5 billion in a corporate bond to fuel its expansion in the region.

The company said it plans to raise Sh5 billion through a corporate bond, but it has an option of raising the amount by Sh1 billion more should subscription exceed the targeted amount.

“Britam expects to use the funds to support several strategic initiatives including real estate opportunities, private equity opportunities, local and regional business growth, and ICT investments,” the Capital Markets Authority said in a statement following approval of the plan.

The bond will be issued in two tranches, with the first batch seeking to raise Sh3 billion, with an option of an additional Sh1 billion in a green shoe option. The second tranche will raise Sh2 billion.

Last month, Britam’s board chairman Francis Muthaura said the company’s efforts to diversify were going as planned and there was now need for more money to deepen its investments across Eastern Africa.

“We have witnessed exponential growth across the business. This transaction will enable the organisation to amplify these efforts across all markets we are operating in,” Mr Muthaura said.

Britam has been involved in various strategic investments including acquisitions of a 25 per cent stake in Acorn, a real estate development and property management group and a 99 per cent stake in Real Insurance, which is expected to be concluded by the second half of this year. 

“We are seeing great opportunities in the region in areas of property, private equity and expansion into new markets. We are progressing well with our current investments including the construction of the iconic 31-storey premium commercial property, expected to be completed by 2016.

“The new funding will therefore help us tap emerging opportunities across the region in tandem with our business strategy,” the firm’s group managing director, Benson Wairegi earlier said.