TransCentury to invest in energy sector

Kenyan investment firm Transcentury plans to invest $100 million-$150 million this year, mainly in the African energy and infrastructure sectors, its chief executive said on Thursday.

Gachao Kiuna said the firm, which already has $150 million in net assets, with the bulk in the energy sector and spread across five African markets, will mainly put the money in electricity and infrastructure.

"We are looking to invest somewhere between $100-150 million," Kiuna said, adding that the amount would be funded by a mix of debt and equity.

"Transcentury is today defined by its business in electricals and power. We will continue to grow that. We are really focusing now on the infrastructure so I would say within the next three years, our infrastructure portfolio will be as big as our power portfolio."

He added that the firm, which started off as a private investment club in the 1990s, would also seek to expand outside of its Kenyan, Ugandan, Tanzanian, Democratic Republic of the Congo and South African markets.

"Short-term we will be involved in all those markets and medium to long-term we will expand to cover most of Sub-Saharan Africa," Kiuna said, adding the bulk of the firm's investments are controlled.

Transcentruy's shares are traded on the Nairobi Stock Exchange's Over The Counter market and will eventually be listed on the main market in the next three years.

Kiuna said the firm uses private equity principles by actively managing its portfolio of investments to maximise returns.

Legal redress

It has a controlling stake in cable manufacturer East African Cables, a small stake in Kenya Power and Lighting Company and a stake in Kenya's Equity Bank jointly with private equity fund Helios.

Other businesses in which it has invested include production of distribution transformers and switchgears in Tanzania, as well as tea-processing in the same country.

Kiuna accused Transcentury's co-investor in a firm contracted to run the Kenya-Uganda railway, South Africa's Sheltam Rail, of violating the terms of the rail concession and selfishly selling part of its stake to another party.

The share sale deal between Sheltam and Egypt's Citadel Capital was announced last month.

"It's a clear breach of the concession. We have already invested $11 million in this company," Kiuna said, adding that Transcentury is seeking legal redress in Mauritius where the rail firm, Rift Valley Railways, is incorporated.

He said Transcentury was willing to put $50 million into the rail business -- once the shareholder wrangles have been resolved -- to help the line start moving 4 million tonnes of cargo per year, from 1 million now, in about five years.