Deposit Taking Microfinance Limited (SMEP DTM) has announced plans to make a restricted (unlisted) offer of shares to selected group of investors to raise capital to finance its national expansion drive.
The deposit taking Microfinance Institution (MFI) is targeting SMEP DTM customers and employees and members of the National Council Churches of Kenya (NCCK)
The transaction is still subject to the Capital Markets Authority (CMA)’s approval.
In a statement issued on Wednesday SMEP DTM Chairman, Gabriel Kivuti, said much of the funds would be used to change the company’s financing mix to reduce reliance on debt finance while lending to customers.
“This will result in improved cost of funds, increased customer satisfaction, more customers and better margins,” he said.
Kivuti said the funds would also be used to finance the development of a new office building on its current property in Kilimani, Nairobi, upgrade a number of its outlets into deposit taking branches, and operationalise the agency services for its satellites and marketing units – including third party agencies.
He noted that SMEP DTM’s principal shareholder – NCCK – would face significant dilution in the project.
“NCCK believes the Church ought to reposition itself to play a more active role in economic development. To achieve this goal, the huge potential of the Church must be consolidated,” said Reverend Cannon Peter Karanja, NCCK secretary general.
“SMEPDTM is the tool to for realising equitable wealth creation and economic empowerment.
By pooling the common wealth of the Church, SMEPDTM gives the Church an opportunity to change the destiny of this country.”
SMEP DTM has appointed Standard Investment Bank (SIB) Ltd as Lead Transaction Advisor, and SIB and Financial Analytics Ltd as Joint Financial Advisor.
SMEP DTM has an asset base of over Sh2 billion and has generated over Sh10 billion in cumulative loans to over 145,000 customers.
It has a national footprint with 42 offices and 276 staff.
SOURCE: Standard Media