Cytonn Investments has acquired a 25 per cent stake in family-owned Superior Homes Kenya Ltd, which intends to list on the Nairobi Securities Exchange (NSE) this year.
The acquisition deal for the Greenpark Estate developer signed in Nairobi on Tuesday is worth Sh1 billion.
Cytonn Investments managing partner and chief executive Edwin Dande said the deal was in line with its strategy of tapping capital from global and institutional investors, such as Taaleri of Finland, who are Cytonn’s development financing partners.
“In Superior Homes, Cytonn gets a partner that has a strong track record in master-planned developments and also construction capabilities. In Cytonn, Superior Homes gets a partner that has a strong track record in structuring real estate investment products,” said Mr Dande.
Superior Homes is a family owned real estate company based in Nairobi valued at Sh4 billion. Currently, Cytonn says it has more than Sh74 billion of investments and projects mainly in real estate.
Superior Homes managing director Ian Henderson said after a strong 10-year track record, it was important to tie up with a partner with shared values and aspirations.
“Through this partnership and the investment, we shall work to grow our deal pipeline, drive the company towards listing on the Nairobi Securities Exchange, subject to regulatory approval, during the course of 2017,” he said.
Superior Homes plans to off-load 15 per cent stake to the public. The process of valuation is still in progress.
Mr Henderson said a listing will make the company more sustainable.
Superior Homes developed the open-plan Greenpark Estate at Stoney Athi, Machakos County, which currently has more than 450 houses complete, school, green zones, sports and recreational facility as well as a shopping complex.
Mid-last year, the company announced its intention to list on the Growth Enterprise Market Segment of the NSE.
Cytonn Investments head of equity and real estate Shiv Arora said through the deal, the parties would be able to fund real estate development and create an environment where the sector can grow.
“It needs financing and we are working to reduce housing deficit, creating jobs and uplifting the standards of living in the economy,” said Mr Arora.
He said there is an increasing middle class looking for decent housing with a lifestyle feel.
The high demand, said Mr Arora, had caused a housing deficit of 250,000 units per annum, which the partnership would be looking to bridge.