By Jimmy Kariuki
Director of Industrial and Commercial Development Corporation (ICDC) majority owned Funguo Investments Limited (‘FIL’) is set to rise 3.5 billion new funds in the next four years through a continuous fundraising, fresh equity capital injections from sale of shares to shareholders, using debt capital and from proceeds of exits from existing investments process in a bid to expand and diversify its investment portfolio.
Funguo which targets the mid-market with investment of up to sh100 million, is looking to invest in the construction and real estate, Wholesale and retail trade, Information and technology Financial and insurance Education and Agribusiness processing among other sectors.
Funguo Investments Chief Executive Officer Kenneth Muchina has today said the company is also exploring investing in the two companies by buying (acquiring) a substantial equity stakes varying amounts in the two managed funds and co-investment programs as additional means of mobilizing capital to fund its investment programs.
“Expect Funguo to come to the market with announcements of new investments in exciting businesses in diverse sectors. You will be seeing Funguo raising fresh capital to fund the investment programs across targeted areas. We are in advanced stages of these pursuits,” said Muchina.
However like any other, private equity funds in Kenya FIL would prefer making investments of at least sh300 million and up to sh1 billion. These funds have a low appetite for early stage risk, and therefore prefer investing in more mature business.
Funguo Investment’s strategic plan provides the company with the framework to keep an eye on what is happening in the environment in which it invests, allowing it to adjust tactics within its shorter term plans (such as annual budgets) as needed.
“We have over the years intentionally sought to diversify the asset classes that we are invested in, and the sectors of the economy that we are exposed to; which allows us to expand our ‘investee’ client base,” said the company’s chief executive.
In 2013, the company opened up its shareholding to the general public, when it became a public company.
Availability of top grade investment opportunities, accessing suitable capital and human capital, the firm said, however remain as some of the challenges facing private equity funds in the country.
Funguo’s focus on private equity type of investments has seen it appeal to a niche market of investors with an appetite for private equity risks and attendant returns.