UAP targets Sh6b from private equity funds

March 27, 2012
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At least 25 percent of the capital to be raised will be through a public offer/COURTESY
NAIROBI, Kenya, Mar 27 – UAP is looking to raise between Sh5.5 and Sh6 billion through private equity funds to boost its expansion strategy and support existing businesses.

At least 25 percent of the capital to be raised will be through a public offer. UAP Holdings Limited Group Managing Director James Muguiyi said engagement with various private equity funds has been positive so far.

UAP also announced its intentions to launch an Initial Public Offer (IPO), which the company hopes will translate to the growth of its shareholder base to 1,000 investors.

The public offer is subject to regulatory approval, while on the horizon the company anticipates a Listing by Introduction to be carried out in 12 to 24 months.

“We had announced an IPO in March 2011, which was postponed in August 2011 in view of the bearish state of the equity public markets. The market at the moment is not conducive for an IPO,” Muguiyi explained.

In efforts to strengthen its real estate business, the MD said, UAP is planning to offer a Real Estate Investment Trust (REIT) under a new asset management company to be operational in the second quarter of this year.

“Some of the products that company will be offering are in REITs. They will take time, but from quarter two we will be making preparations to be ready to offer those products,” Muguiyi said.

The total enterprise value of the properties in UAP’s development pipeline is in excess of Sh8 billion in Kenya, Uganda and South Sudan.

Some of the insurer’s key projects include a 30 storey UAP Tower in Nairobi to be completed in June 2014, the Nakawa Business Park in Kampala to be done by October this year and the Equatoria Tower in Juba to be complete in August next year.

Completed real estate developments under UAP are Union House, Equity Centre, and Telkom Plaza in Nairobi as well as UAP Insurance House in Kampala.

“We intend to start operations in Rwanda and the DRC in 2012, and we are also in discussions with potential targets to enter the Tanzania market during the course of the year,” Muguiyi revealed of expansion plans.

Other markets UAP is eyeing to enter by 2014 to increase its Pan-African presence include Ethiopia, Burundi, Ghana, Nigeria, Malawi and Zambia.

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