KenGen to raise $280 million on stock market for project development

KenGen to raise $280 million on stock market for project development Olkaria I Units 4 & 5 Geothermal Plant. Source: KenGen
Alexander Richter 11 May 2016

KenGen has received approval for a rights issue in which it hopes to raise up to $280 million to finance geothermal and wind project development in Kenya.

In Kenya, the Capital Markets Authority has granted Kenya Electricity Generating Company (KenGen) approval to undertake a rights issue in which the electricity generator seeks to raise Kshs 28.7 billion ($280 million) by issuing and listing 4,396,722,912 new ordinary shares. The rights will be issued on the basis of two new ordinary shares for every one existing share held by each shareholder on the register as at Friday 13 May, 2016.

According to KenGen’s information memorandum, the proceeds of the rights issue will be used partly to fund new geothermal and wind power projects so as to generate an addition 720 megawatts of electricity, up from 1,631 megawatts as at 30 June, 2015. The funds will also inject new equity into the Company, so as to create additional headroom that will enable it to access long-term loans at low interest rates, to facilitate its expansion.

KenGen noted in the information memorandum that the Government, the major shareholder with a 70 percent stake, will take up and pay for its full rights through the conversion of part of the on-lent loans to the company in the sum of Kshs20 billion ($200 million).

Source: Kenya’s Capital Market Authority