Shelter Afrique receives Ksh.1.7 billion in new capital

Pan-African based housing development financier Shelter Afrique has received Ksh.1.7 billion ($16 million) in new capital injection from its shareholders.

Nigeria has remitted Ksh.1 billion ($9.4 million) of the contributions as part of an higher Ksh.3.2 billion ($29.3 million) committal while Rwanda, Uganda, Lesotho, Mali, Namibia, Togo, Zimbabwe and Swaziland have remitted the balance of Ksh.715 million ($6.6 million).

The combined injection has lifted the company’s paid up capital base to Ksh.14 billion ($129 million) from Ksh.12.3 billion ($114 million) at the end of its financial year in March.

“This is a strong show of confidence in Shelter Afrique by member countries that the institution is now better governed and has significantly improved its financial performance. As a result, shareholders have supported the recapitalisation of the institution as demonstrated by the significant capital contributions,” said Shelter Afrique Managing Director Andrew Chimpondah.

The company however remains off its required authorized Ksh.108.3 billion ($1 billion) capital base and Ksh.39.6 billion ($366 million) issued capital.

In the last financial year Shelter Afrique received Ksh.1 billion in new capital injection against a target of Ksh.2.1 billion as its shareholders who are majority made up of 44 African countries remained under domestic fiscal constrains.

The company has been betting on the enrollment of a new category of shareholders referred to as ‘Class C shareholders’ – institutions drawn from outside the continent including sovereign countries and multi-lateral lenders to boost its capital base.

In March, the company came closer to breaking its duck of loss making as it posted a 94 per cent decline in losses to Ksh.63 million on cost cutting efforts.

The company plans to return to the Kenyan corporate bond market to raise more funds after a return into profitability.

Kenya holds the largest shareholding in the affordable housing based firm at 14.87 per cent ahead of Nigeria and the African Development Bank (AfDB).

Shelter Afrique is expected to host its annual general meeting (AGM) virtually between September 15 and 17, 2020.