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DFC, Finnfund commit $15mln to Kenyan company Kentegra Biotechnology

Wednesday, 23 August 2023 18:26
DFC, Finnfund commit $15mln to Kenyan company Kentegra Biotechnology

(Ecofin Agency) - The loan and equity financing will fund the construction of a pyrethrum processing plant in Kenya. Through this initiative, the American and Finnish investors are strengthening their commitment to Kenya's agricultural sector.

Finnish impact investor Finnfund and US development finance agency DFC have jointly committed $15 million to US-Kenyan company Kentegra Biotechnology, which specializes in the manufacture of insecticides and pesticides from pyrethrum flower extract. The funding was announced, by Finnfund, in a release published last Tuesday (August 22). 

Specifically, DFC provided a $10 million loan while Finfund granted $5 million in equity financing. The funds will finance the construction of a new pyrethrum processing plant in Kenya, boost Kentegra Biotechnology's production capacity, and strengthen its network of local suppliers (farmers). 

"Kentegra is a company that meets all investor expectations, both in terms of commercial success, sustainability, and impact. It has plenty of growth potential in a very interesting upward trending market," commented Johanna Raehalme, head of Finnfund's office in Nairobi, Kenya.

In early April, Micah Thuo, Head of Operations at Kentegra, announced plans to build a new pyrethrum processing plant in Nakuru County, Kenya. To finance this initiative, the company approached DFC and Finnfund. The latter, after examining the project, gave their approval by granting the necessary resources for the project.

DFC's commitment to Kentegra Biotechnology represents its second operation in Kenya this year. The first investee was Hewa Tele Medical Oxygen, which operates in Kenya's healthcare sector.

In 2022, Africa was Finnfund's top investment destination, accounting for 57% of volume and 54% of investment decisions. In Kenya, the Finnish investor is particularly involved in the energy, water, healthcare, and hotel sectors.

Chamberline Moko



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