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AFC participates in US$150 million syndicated loan facility to Kenya Power

Africa Finance Corporation (AFC), the leading Infrastructure focused investment grade rated multilateral development finance institution, has today announced the provision of a US$25 million loan as part of  a US$150 million senior unsecured syndicated loan facility to the Kenya Power and Lighting Company Limited (KPLC). The facility is for the rehabilitation and expansion of Kenya’s power transmission and distribution network to increase its capacity from the current 2,000MW to 5,000MW by 2020. This is in line with the Government of Kenya’s  power sector policy. 

The Kenyan economy is projected to experience real GDP growth of circa 5.7% in 2015, largely driven by investments in infrastructure projects. KPLC owns and operates most of the electricity transmission and distribution network in Kenya and sells electricity to over 2.6 million customers.  The Company’s key mandate is to sell power to retail and business customers and in order to achieve this it needs to ensure that the network is capable of carrying the power.  KPLC is listed on the Nairobi Securities Exchange, with the Government of Kenya owning 50.1% of the equity and various private investors and the Kenyan public owning the balance.

AFC is a private sector-led multilateral development financial institution, established in 2007, with a mission to improve African economies by proactively developing and financing infrastructure, industrial and financial assets. AFC is involved as an investor, developer and financier of various infrastructure projects.  AFC provided a US$50 million convertible debt investment in ARM Cement Limited (ARM), the second largest cement operator in Kenya to support expansion initiatives across Eastern and Southern Africa including; development and construction of a lime plant in Tanzania and expansion of ARM’s cement capacity in Kenya. The transaction marked AFC’s first bilateral investment in Kenya.
AFC is gaining recognition as the benchmark institution for financing the development of infrastructure projects in Africa. AFC’s current authorized share capital is US$2.0 billion with shareholders’ funds of US$1.28 billion and a 2014 funding program of over US$1 billion. AFC is the second highest investment grade-rated multilateral financial institution on the African continent, with an A3 (long term) /P2 (short term) foreign currency debt rating by Moody’s Investors Service.