Shareholders of Kenya Electricity Generating Company have approved plans by the company to raise new capital to finance power projects in 2014.
This will see the company issue 2.2 billion shares in the market most likely through a Rights Issue in the first half of 2014. At the current price of Sh15, this would be expected to raise Sh30 billion. The company has a total of 2.2 billion shares listed at the Nairobi Securities Exchange meaning that the Rights Issue would be in the ratio of 1:1.
Ultimately, KenGen plans to raise its share capital from Sh5.5 billion to Sh25 billion through creation of 7.7 billion new shares. The 2.2 billion new shares approved is the first tranche in the capital raising project by Kenya's largest electricity producer seeking to raise $4 billion (Sh350 billion) for new projects over the next four years through a mix of debt and equity.
The new projects comprising mainly a mix of geothermal and wind energy are expected to boost KenGen's power generation capacity by 400 megawatts by 2014.