Macadamia firm Privamnuts secures Sh387 million funding

Privamnuts, a processor and exporter of macadamia nuts from Kenya to Europe, USA and the Far East has received ESG First Fund of Sh387 million ($3 million) from Aavishkaar Capital in partnership with German state-owned investment and development bank (KfW)

The funding will be utilised to expand production capacity and undertake several sustainability initiatives. The ESG First Fund is a USD 250 Mn fund focused on investing in Africa and Asia with a mandate to generate superior Environmental and Social Governance (ESG) outcomes, with commercial and financial returns alongside positive social impact.

The fund's earlier two investments in Africa was in Hela Apparel Holdings PLC, a company providing sustainability-focused apparel supply chain solutions to some of the world’s leading apparel brands and in Balaji EPZ, an apparel manufacturer with two decades of manufacturing experience for the world’s leading denim brands.

Privamnuts is based in Embu, Central Kenya, at the foot of Mt. Kenya where the soil allows for the natural growth of high-quality macadamia nuts and where most macadamia farmers in Kenya are located.

The company works with 10,000 small-holder farmers maintaining strong relationships with these farmers by providing input support, training on good agricultural practices and making timely payments. These initiatives have helped the company build a consistent supply base and loyalty from the farmers.

Privamnuts has a proven and resilient business model and has built strong relationships with its customers with most key customers regularly buying from the company for over 3- 5 years.

The company has maintained its profitability during the Covid period as well as through 2023 when the global macadamia prices we at an all-time low, demonstrating robustness of the business model.

“We are excited to be partnering with Aavishkaar Capital, with whom our goals are aligned, Privamnuts and Aavishkaar Capital believe in creating high quality jobs that can improve the economic and social well-being of farmers and workers and uplift communities while delivering high quality agri & food products to global customers.” said, Patrick Mbogo, Founder & Managing Director, Privamnuts EPZ Kenya Ltd.

Commenting on the investment, Darren Lobo, Aavishkaar Capital said, “We are excited to invest in Privamnuts and help strengthen the company’s position as one of the country’s largest macadamia exporters. Macadamia nuts are premium tree nuts and often dubbed as the world’s most expensive nut.

Kenya enjoys a significant global competitive advantage in macadamia production given the favourable agro-climatic conditions in key growing areas and is the 3rd largest exporter of macadamia nuts. The industry has significant job creation potential and is very environmentally sustainable. Macadamia trees are low resource intensive and are good for carbon sequestration.

Privamnuts is emerging as a leading exporter and is already one of the largest employers in Embu County, the company’s traceability initiatives have helped it position itself as a reputable global supplier. We are confident that this partnership with Privamnuts will go a long way in accelerating business growth, creating employment opportunities and cementing Privamnuts’ position as one of Kenya’s leading exporters of macadamia nuts.” Dr. Markus Aschendorf, Head of Division, KFW said.

“It is important that environmental and social aspects are not only respected but treated as an essential part of the broader business strategy. We want to help Privamnuts get best in class and be a beacon example to its peers.”