Manufacturer of construction materials, Kisumu Concrete Products Limited (KCP) has Thursday announced the completion of an investment deal with Ascent Rift Valley Fund, making it the first company to attract Private Equity funding in Kisumu.
KCP has been in operations for 40 years, providing the construction industry with quality products ranging from aggregates, pozzolana, concrete blocks, paving blocks, ready-mix concrete, roofing tiles and other concrete pre-cast items.
Speaking during the announcement in Kisumu, Vimal Rabadia, the Chief Executive Officer of KCP, said that the funds injected into the company will go into expansion, scaling up production to meet market demand and towards advancing the use of technology to ensure production of quality products.
The capital injection into KCP comes at an opportune time, which favors business growth in Kisumu and the neighboring counties. Kisumu has seen a boom in real estate investments largely driven by population growth, devolution and countrywide infrastructure development which makes the city more accessible for residents, investors and tourists alike through roads and the airport.
“The construction industry continues to evolve and the demand for construction materials is at an all-time high. Deploying advanced technology will enable us to meet the increased demand and also improve on the quality of our products,” Rabadia said.
The introduction of the e-construction permit by the Kisumu County Government has also made it easier for investors to put up their projects in the county. A survey by the World Bank in 2015, revealed Kisumu is the only county in Kenya where one can get the fastest approval for building plans. This initiative by the county government is expected to attract more investors to do business in the county.
“We are looking to expand and diversify our range of concrete products and this partnership with Ascent will now make it possible. These expansion plans will enable us to increase employment and contribute more to the national and county revenues through taxes,” Mr. Rabadia added.
The Ascent Rift Valley Fund is the leading SME Private Equity Fund in Kenya, Uganda and Ethiopia. Ascent targets scalable fast growing enterprises with investments of between $5 million and $15 million per Investee Company.
“The wider western region holds great potential for growth and we identified Kisumu Concrete Products Ltd as the company we want to grow with. We will work closely with the KCP management team to develop and grow the company for long term growth and profitability,” said David Owino, Managing Partner at Ascent Capital Advisory Services LLP during the announcement.
The KCP deal brings to four the total number of investments by the fund in East Africa, having previously made investments into laboratory services in Ethiopia and distribution and financial services in Uganda.
“We pride ourselves at having cast our nets outside Nairobi the Capital City to have these conversations. There are a number of interesting and bankable businesses that we have been in talks with already for some time. We will be announcing our fifth investment soon,” David Owino concluded.