Britam Blog

Blogs

What’s New? Investing in Energy – Private Equity Fund

Britam Asset Managers (K) Ltd Invests Kes.1.4 Bn in an Energy Private Equity Fund To Diversify its Investment Portfolio

Britam Asset Managers invested Kes.1.4 billion into Everstrong Power Limited in efforts to diversify its portfolio. This is the first such investment in of its kind in Kenya thus illustrating the company’s value for innovation. Everstrong Power Limited, a private equity firm that invests in energy assets in Africa, has used the funds to buy a stake in the 80MW Heavy Fuel Oil Athi River Power Plant owned by Gulf Energy, one of the top oil and energy players in East Africa. The power plant was commissioned in 2014 with a 20-year power purchase agreement (PPA) with Kenya Power.

“Through this investment, Britam’s Asset Managers institutional clients will achieve diversification not only across asset classes but also across currencies. This is because the returns from the power plant will be in hard currency,” stated Kenneth Kaniu, Chief Executive Officer, Britam Asset Managers.

“Through this investment, Britam Asset Managers is playing a role in both the funding and in the provision of long term capital into the Kenyan power sector.” Kenneth added.

Britam Asset Managers, one of East Africa’s leading and established asset management companies, currently manages Kes.158 billion in assets under management and invests assets for both institutional and retail clients. Among its institutional clients are Pension Schemes, University Endowment Funds, Insurance Funds and Foundations, which focus on long term assets. 

In Kenya, asset allocation for these clients has largely had a bias towards traditional asset classes, that is the equity market, corporate bonds, commercial papers, T-bills, T-Bonds and bank deposits, leaving little room for diversification. This explains why overall investment returns have been quite volatile in Kenya.

“Through this investment, these clients will be able to have more stable and less volatile returns and they will benefit from the diversification this asset will provide.” said Kenneth Kaniu.

He also added that through this investment, more local institutional and retail capital could be unlocked to fund infrastructure and energy investments in the region given the long term funding profile of the assets available.

Speaking at the press briefing, Everstrong Capital LLC Principal Africa and Country Head Kenya, John Ouko said, “We wish to thank Britam Asset Managers for allowing Everstrong to manage its first investment in infrastructure. This is a good start and we intend to assemble more investments that allow Britam and others to invest into energy , transport and communications infrastructure in Kenya and other parts of Sub-Saharan Africa.”  

Speaking at the same press briefing, Gulf Energy Group CEO, Francis Njogu also added, “We are pleased to have investment by Britam through Everstrong Power in what is arguably the best performing Independent Power Producer in the country. The power produced meets and exceeds the performance and contractual requirements by Kenya Power. As the leading local developer of power projects in the country, Gulf Energy continues to offer very attractive investment opportunities to partners such as Britam, with access to large pools of capital looking for excellent and stable long term returns.”

 

 

More Blog Entries

Message From Britam Asset Managers CEO

Britam Asset Managers, was founded in 2004 with the main aim of filling a gap in...

Start the journey to your financial destination.

It’s up to you to make things happen. Infuse your life with action. You’ve been...

0 Comments