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TPS eyes Kenyan bourse for funds

NAIROBI, Kenya, May 20 – TPS Eastern Africa Limited (TPSEA), owner of Serena Hotels, plans to raise over Sh1.2 billion through a Rights Issue at the Nairobi Stock Exchange (NSE) to drive its ambitious regional expansion plans. 

The company plans to issue 24,701,774 new shares at a rate of one share for every five held in the issue which is subject to Capital Markets Authority and Nairobi Stock Exchange approval. The shareholders will also be sought at the company’s Annual General Meeting on May 24.

TPSEA Managing Director Mahmud Jan Mohamed said proceeds from the issue will be used to fund various projects among them the acquisition of a majority stake in Upekee Lodges as well as assets of Mbuzi Mawe Tented Camp and Mountain Village.

The capitalisation of Jaja Limited, a special purpose vehicle to be used by the firm for the development of a number of tourist properties in Kenya and the  expansion and refurbishment of Nairobi Serena and Kigali Serena Hotels are also on the cards.

“We have ambitious plans for the future growth of Serena Hotels, buoyed by our strong trading record and increasing optimism in the tourism sector in East Africa.  We are planning to use proceeds of the Rights Issue to expand capacity and to upgrade our existing portfolio of properties in order to meet increased demand at the top end of the market,” he said.

Mr Mohamed added that the funds raised from the Rights Issue would be complemented by long-term borrowing and other sources of funds that the Board had approved.

The company has already appointed a team of professional advisors to handle the issue. Kestrel Capital and Standard Investment Bank will be the lead transaction advisors and sponsoring stockbrokers, while Kaplan & Stratton Advocates and Diamond Trust Bank will act as legal advisors and receiving bank respectively.

The Aga Khan Fund for Economic Development [AKFED] is a major shareholder of TPS Eastern Africa Limited, which has majority shares in TPS. AKFED promotes tourism by building and managing hotels, in selected areas of the developing world that contribute to economic growth in an economically viable and environmentally sensitive manner. 

Serena’s portfolio currently comprises a total of 23 luxury hotels, resorts, safari lodges and tented camps in Kenya, Tanzania, Zanzibar, Mozambique, Uganda and Rwanda. Serena also owns and manages properties in Afghanistan, Pakistan and Tajikistan as part of its mandate to contribute to economic growth in an environmentally and culturally sensitive manner.


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