Nairobi, Kenya, June 24, 2010
—IFC, a member of the World Bank Group, announced today that it will invest in and provide advisory services to Spencon International to help the Kenya-based engineering, procurement, and construction company expand its commercial and public infrastructure projects across Eastern and Southern Africa.
IFC is loaning Spencon $12 million, which the company will use for working capital and to fund infrastructure projects of its subsidiaries operating in Kenya, Tanzania, Uganda, and Zambia. Spencon, one of East Africa’s largest construction companies, will also explore opportunities in new African markets.
IFC’s investment in Spencon will be its first in a construction company in Africa. In addition to providing affordable, long-term financing to support the company’s expansion, IFC will advise the company on improving its quality of work, and raising its environmental, social, and health standards.
JC Patel, Chairman at Spencon, said, “Working with IFC will provide Spencon with access to the long-term financing tailored to the needs of our business, allowing us to undertake new projects and sustain our pace of growth. Spencon is pleased to partner with IFC to help meet the increasing demand for infrastructure-related construction in Eastern and Southern Africa.”
Jean Philippe Prosper, IFC Director for Eastern and Southern Africa, said, "IFC supports the development of infrastructure, a significant need in Africa. IFC’s partnership with Spencon is part of our strategy to work with local engineering, procurement and construction companies that contribute significantly to building infrastructure in the region."
Africa suffers from an acute shortage of infrastructure, hampering the region’s economic growth and its global competitiveness. Despite strong demand, many construction companies cannot bid for infrastructure projects because they lack adequate financing and working capital, preventing them from acquiring raw materials and purchasing equipment.
Alex-Handrah Aimé, a Spencon board member and Director of Emerging Capital Partners, Spencon’s sole institutional investor, said, “IFC’s loan is a financial milestone in Spencon’s plans for long-term growth. It builds on efforts Emerging Capital Partners has undertaken since our initial 2006 investment in Spencon to strengthen the company’s balance sheet, improve corporate governance and win the confidence of international financial institutions like the IFC.”
About IFC
IFC, a member of the World Bank Group creates opportunity for people to escape poverty and improve their lives. We foster sustainable economic growth in developing countries by supporting private sector development, mobilizing private capital, and providing advisory and risk mitigation services to businesses and governments. Our new investments totaled $14.4 billion in fiscal 2009, helping channel capital into developing countries during the financial crisis. For more information, visit
www.ifc.org
.
About Emerging Capital Partners
Emerging Capital Partners (ECP) is the first private equity firm to raise more than $1.6 billion to invest in companies across the African continent. The ECP team has a ten-year track record of pan-African investing. The firm's investment strategy is focused on delivering consistently above-market returns to investors that are uncorrelated to the U.S. and other global economies. For more information, please see
www.ecpinvestments.com
.
