African Development Bank (AfDB) has made a US$10 million strategic equity investment in Dhamana Guarantee Company, a Kenyan-based firm that offers guarantees to support sustainable growth enterprises.
In a statement on Wednesday, AfDB said the investment follows the anchor investment from the UK-based Private Infrastructure Development Group.
Under the investment plan, Dhamana will also get equity investment from County Pension Fund Financial Services as well as technical assistance support from Cardano Development and Financial Sector Deepening Africa.
The company will support access to financing for players in key sectors such as water, transport, waste management, and renewable energy. It is also committed to facilitating sustainable and green financing in the East African region.
“The African Development Bank’s equity investment in Dhamana reinforces the catalytic role and potential of credit enhancement companies in leveraging opportunities for infrastructure financing in local currency,” said Solomon Quaynor, AfDB’s vice president for the private sector, infrastructure, and industrialization.
“The investment in Dhamana aligns with the Bank’s priority to mobilize financing through innovative vehicles from African institutional funds, including pension funds, sovereign wealth funds, and insurance companies for infrastructure development in Africa,” Quaynor further added.
Speaking during the signing ceremony in Nairobi, Dhamana Chief Executive Officer Christopher Olobo said, “With the support of our investors and supporters, the Private Infrastructure Development Group, Cardano Development, FSD Africa, CPF Financial Services, and the African Development Bank, we have worked to develop Dhamana as an important catalyst for long-term sustainable finance in the region.
“Dhamana’s local currency guarantees will connect pools of untapped capital with East Africa’s real economy, making a tangible difference to people’s lives and offering local investors the opportunity to invest in Paris-aligned initiatives,” Olobo added.
Dhamana Guarantee Company is a firm that works to catalyze the development of local capital markets not only in Kenya but also in East Africa. It works by connecting underutilized sources of domestic capital markets with the real economy.
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