RVR owner considers strategic options to raise investment capital

Kenya: Pan African infrastructure and industry investment company Qalaa Holdings, the majority investors in Rift Valley Railways (RVR) - the Kenya-Uganda railway concessionaire - is looking at different alternatives to increase liquidity for its investment financing.

The Egypt-based firm said this as it announced it had appointed a top financial strategy adviser in the market, to advise on the full exit of Tanmeyah for Microfinance Services, one of its portfolio companies in which Qalaa holds a 70 per cent stake. Tanmayeh is the largest private micro-finance firm in Egypt.

“Qalaa Holdings is on track in divesting from non-core holdings. Our ongoing divestiture of those non-core businesses will allow us to de-risk, de-leverage and to invest in growth opportunities for our core subsidiaries,” Chairman and Founder Ahmed Heikal said.

He said the exit from Tanmeyah, if concluded, would provide the firm with liquidity that exceeds the needs of both its current de-leveraging programme and financing needs.

“It will also permit share buyback by Qalaa Holdings on an opportunistic basis.” The potential exit of Tanmeyah is part of Qalaa’s previously announced programme to divest a number of its non-core subsidiaries.

In 2014, Qalaa Holdings exited its investments in the Sudanese Egyptian Bank, Sphinx Glass and Foundries AAC and AMC as well as Pharos Holding. “Qalaa continues to explore its option to exit non-core industries to permit further share buyback and improvement of cash position so long as management considers the company’s share to be trading at a steep discount to its fair market value,” concluded Heikal.

Formerly known as Citadel Capital, Qalaa Holdings controls subsidiaries in core industries including Energy, Cement, Transportation & Logistics, and Mining.