The private equity space in Kenya has become increasingly vibrant as companies seek to raise capital through avenues other than going public on the securities exchange or debt in the fixed income market.
Data from Pitchbook shows that the value of disclosed private equity transactions in Kenya hit a peak of $850.7 million in 2017 buoyed by large ticket size ones such as the $450 million injection of development capital into Kingspride Properties by Milost Global.
The role of the Capital Markets Authority (CMA) role in regulating private equity and venture is, however, still raising numerous queries especially given that the private equity space in Kenya is dominated by foreign capital.
“It comes from the consideration of how these funds raise their capital and the fact that sometimes they do access funds from the public and therefore this creates need for accountability in the way the funds raised are being used,” the acting CMA chief executive, Wyckliffe Shamiah, said.
Mr Shamiah has sought to disabuse private equity players of the notion that the CMA is looking to compel them to exit via the Nairobi Securities Exchange as way of stirring up activity in the bourse which is afflicted by a dearth of new listings.
The view that private equity activity has stolen the thunder from the bourse, he says, is misguided since private equity forms an integral asset class in Kenya’s capital markets.