Kenya Power Ltd., the sole electricity distributor in East Africa’s biggest economy, said it will borrow from domestic banks and multilateral lenders to fund a 109 billion-shilling ($1.1 billion) expansion plan.
The money will be spent on maintaining and expanding the Nairobi-based company’s network to reach more customers, Kenneth Tarus, general manager for finance, said in an interview Friday. Part of the funds will come from internal resources and the rest will be borrowed from the World Bank and the African Development Bank, he said.
“We will also borrow from local banks that will give us competitive rates,” Tarus said. Funding may also be sought in the domestic market, he said.
Kenya Power earlier posted a 6.1 percent increase in full-year profit to 7.43 billion shillings, as electricity sales grew 5 percent to 7.13 million units. Revenue grew to 106.8 billion shillings from 105.4 billion shillings, while power-purchase costs surged 45 percent to 44.5 billion shillings because of additional capacity charges for new plants.
The shares fell 3.5 percent to 15 shillings, heading for its biggest decline since Sept. 2. That pared the stock’s advance this year to 3.8 percent, outperforming the Nairobi Securities Exchange All Share Index’s 15 percent decline.