NMG pension fund invests $1m in equity firm
(From left) Stanlib chief investment officer East Africa Kenneth Kaniu, Ascent Partner David Owino, NMG Staff Retirement Benefit Scheme trustee Wallace Kantai and Ascent Partner Guy Brennan during the signing at Nation Centre in Nairobi on February 25, 2015. PHOTO | DIANA NGILA |
What you need to know:
- Entities scour far and wide for opportunities to increase earnings for members.
- Move opens up wider growth avenue with the ultimate goal of enriching returns.
Nation Media Group pension fund has signed a Sh91 million ($1 million) investment commitment with Ascent Capital, becoming the second fund to invest through a local private equity company.
Ascent received the commitment from Nation Media Group staff retirement scheme on Wednesday through its fund managers Stanlib Kenya, potentially opening up a new growth avenue for pension funds.
“It opens up a new investment class for us, which will help us generate good returns for our members. We are also confident that this is the first of many investments of this kind by our fund,” NMG Staff Retirement Trustee Wallace Kantai said at the signing in Nairobi on Wednesday.
ALTERNATIVE ASSET CLASS
Ascent Partner David Owino said pumping money in private equity as an alternative asset class, will enable pensioners access an interesting mix of investment opportunities within the medium and small enterprises market in East Africa.
“One of the key advantages that private equity is offering pension funds is a mix of investment opportunities managed by seasoned investment professionals,” he said.
Kenya Power pension fund last year invested Sh350 million in Ascent Capital, becoming the first fund in the region to leverage on the new opportunity.
In July last year, Ascent announced the first close of the Ascent Rift Valley Fund (ARVF), which raised $50 million (Sh4.5 billion) to be invested in growth enterprises in Uganda, Ethiopia and Kenya.
Its investors are Norfund (Government of Norway), OeEB (Government of Austria), family offices and institutional investors, including the pension funds.
Ascent is looking to invest in majority stakes in 10 to 12 companies across seven countries with most being in Kenya, Uganda and Ethiopia.
The majority of investments will be between $3 million (Sh273 million) and $7 million (Sh637 million) over a period of five to 10 years.
