Connect with us

East Africa

Kenyan businessman James Mwangi donates $1 million to support families facing extreme hunger

Kenya is suffering from its worst drought in decades.

Published

on

James Mwangi.

James Mwangi, one of Kenya’s wealthiest investors and businessmen, has donated Ksh120 million ($1 million) to aid families affected by the country’s continuing drought, as well as to alleviate hunger and food insecurity in the region.

The businessman, who announced the donationin the presence of Kenya’s newly elected President William Ruto at a meeting focused on strategies for resolving the current hunger crisis in East Africa, urged the government to seek a permanent solution to the region’s hunger.

“It appears it’s a perennial issue, so why don’t we look for a permanent solution? On behalf of my family and the Equity Group on matching grant through the Equity Foundation, I will give $1 million,” Mwangi said.

His donation comes just five days after Ruto signed a deal with Fortescue Future Industries, a global green energy company led by Australian billionaire Andrew Forrest, to build a 300-megawatt (MW) green ammonia and green fertilizer plant in Kenya by 2025 during the UN Climate Change Conference (COP27) in Egypt.

The 300-MW fertilizer plant, which will be constructed under a strategic partnership agreement between the Kenyan government and Fortescue, is part of the administration’s efforts to increase food production and combat food insecurity in the region.

Kenya, like most of East Africa, is suffering from the worst drought in four decades and is bracing for its fifth consecutive failed rainy season, threatening the lives of nearly 20 million people.

In a recent report on the food system in Africa, the World Bank revealed that the continent is presently suffering from its third severe drought in ten years, which has left millions of people—particularly women, children, and the elderly — in extreme poverty, food insecurity, and acute hunger and malnutrition.

The capacity of households to deal with hunger and food insecurity is dwindling as a result of a number of shocks that are limiting resources. In Kenya, nearly 30 percent of households reported having a member who went without food for a day.

The $1 million gift from Mwangi, CEO of Equity Group and one of Kenya’s wealthiest businessmen, will be crucial in addressing the country’s severe hunger problem.

Mwangi, who has played a significant role in the development and transformation of Kenya’s financial services sector, holds a sizeable 3.38-percent stake in Equity Group, Africa’s largest lender. At the time of writing, the stake is worth Ksh6.7 billion ($55 million).

East Africa

James Mwangi’s Equity Group to receive $4.1 million for acquisition of Spire Bank

Equity Group is the largest financial services conglomerate in East Africa.

Published

on

James Mwangi.

Equity Group Holdings, the Kenyan financial services giant led by James Mwangi, is set to receive millions of dollars from Mwalimu Sacco’s acquisition of financially distressed Spire Bank, as the teachers-backed lender agreed to pay Equity Group Ksh510 million ($4.1 million).

The deal is structured as an asset purchase transaction, backed by the Central Bank of Kenya (CBK), and will see Equity Group assume control over the assets and liabilities of the troubled bank.

The $4.1-million payment by Mwalimu Sacco to Equity represents the difference between the assets and liabilities of Spire Bank, implying that the bank holds zero value and the teachers have lost millions of dollars after purchasing a majority stake in 2014.

Mwalimu Sacco CEO Kenneth Odhiambo said the key consideration was to stop the bleeding and preserve Sacco’s bottomline for its members.

Equity Group will settle all redundancy costs for the more than 100 employees who will lose their jobs following the deal. The bank’s non-performing loans stand at Ksh2.63 billion ($21.1 million), and Equity’s immediate task will be to step up collections and recoveries.

The process of exiting Spire Bank was not as seamless as the initial acquisition, with Mwalimu Sacco citing the bank’s decline as beginning after the withdrawal of Naushad Merali’s deposits worth Ksh1.7 billion ($13.7 million), which represented one-fifth of the bank’s total deposits. 

The takeover of the troubled Spire Bank may present additional challenges and opportunities for Equity Group, which under the leadership of Kenyan businessman, Mwangi reported profits in excess of $280 million in the first nine months of 2022.

As of today, Equity Group shares on the Nairobi Securities Exchange are trading at Ksh44.95 ($0.361) per share, a 0.99 percent decrease from their closing price on Fri., Jan. 27.

This values the company at Ksh170 billion ($1.36 billion) and Mwangi’s 3.38-percent stake at Ksh5.74 billion ($46.1 million).

Continue Reading

East Africa

Meet Mohammed Dewji, Tanzania’s ‘King of Wealth,’ with $1.5-billion net worth

Dewji showcases his philanthropic spirit through his role as the founder and financier of the Mo Dewji Foundation.

Published

on

Mohammed Dewji
Mohammed Dewji. ©Billionaires.Africa

With a staggering net worth of $1.5 billion, Mohammed Dewji, the CEO of Mohammed Enterprises Tanzania (MeTL) Group, stands tall as the richest man in Tanzania and one of Africa’s most prominent billionaires.

His prominence in the African business arena is further accentuated by his position as the head of MeTL Group, one of East Africa’s largest industrial conglomerates. The majority of his $1.5-billion fortune is attributed to his stake in the group.

METL Group, a highly successful conglomerate established by its founder’s father in the 1970s, has an impressive reach across a wide range of industries, including trading, agriculture, manufacturing, energy and petroleum, financial services, mobile telephony, infrastructure, real estate, transport, logistics, and distribution.

The highly diversified company has established itself as Tanzania’s largest domestically-grown corporation, with a presence in 11 African nations, including Uganda, Ethiopia, Kenya, Rwanda, Burundi, Zambia, Mozambique, Malawi, the Democratic Republic of the Congo, and Tanzania.

Beyond his business ventures, Mohammed Dewji also showcases his philanthropic spirit through his role as the founder and financier of the Mo Dewji Foundation, a charitable organization dedicated to providing scholarships for underprivileged children in Tanzania.

With a view to tackling the growing food security challenges faced by Sub-Saharan Africa, Mohammed Dewji announced his intentions to go public with an agriculture company in either New York or London in 2023.

He declared that the ambitious $4-billion initiative will receive robust support from top-notch development banks and will be executed via a blank check agreement, delivering a much-anticipated uplift to the agriculture industry.

The proposed investment comes at a pivotal time in the world, as food prices continue to soar due to disruptions in the global supply chain network. This has resulted in a significant hike in the cost of staple commodities, including grains, edible oils, and fertilizers. 

Dewji added that the $4-billion blank check arrangement, which will result in the launch of an agricultural venture, is a fantastic way to bring food security to Africa’s heels because it will capitalize on the continent’s potential to feed itself and the world.

He explained that the agricultural company, which may diversify into soybean and sugar plantations, could provide investors with a five- to ten-fold return over a decade, but it would necessitate “patient, impactful, long-term capital.”

Continue Reading

East Africa

Kenyan banker James Mwangi’s Equity Group receives approval to acquire Spire Bank

Mwangi owns 3.38 percent of the financial services group.

Published

on

James Mwangi.

Equity Group Holdings, a reputable financial services group led by Kenyan businessman James Mwangi, is set to acquire the financially distressed Spire Bank on Jan. 31, cementing its position as East Africa’s leading financial services group.

Following approval from both the National Treasury and the shareholders of both banks, the recent development marks the completion of a long-awaited merger.

“Pursuant to section 9 (1) of the Banking Act, the Cabinet Secretary for the National Treasury and Planning has granted approval for the acquisition of select assets and liabilities of Spire Bank Limited by Equity Group, led by James Mwangi,” Central Bank of Kenya Governor Patrick Njoroge stated in a gazette notice.

The new deal, modeled after the successful partnership between SBM and Chase Bank in August 2018, is set to be implemented on Jan. 31 and will result in the end of Mwalimu Sacco’s ownership of the bank, which they acquired for more than Ksh2.7 billion ($21.7 million) in 2014 from late Kenyan tycoon Naushad Merali.

The process of exiting the bank has not been as seamless as the initial acquisition, with Mwalimu Sacco citing the bank’s decline as beginning after the withdrawal of Naushad Merali’s deposits worth Ksh1.7 billion ($13.7 million), which represented a fifth of the bank’s total deposits.

Spire Bank’s financials for the first quarter of 2022 showed a loss of Ksh188 million ($1.51 million), bringing the total accumulated losses to Ksh9.7 billion ($77.9 million). In addition, the bank was in default on all CBK capital and liquidity ratios.

Despite a challenging macroeconomic environment that has increased the cost of living for East African teachers and other workers, Spire Bank has pursued a turnaround based on lower costs, loan recoveries, and the conversion of shareholder deposits into equity.

Equity Group, which has the financial and managerial strength to put Spire Bank back on track and pull it out of its recent financial difficulties, will get a good deal by accepting teachers’ deposits, as well as Ksh1.3 billion ($10.8 million) in liabilities and nearly Ksh900 million ($7.48 million) in assets linked to Spire Bank.

The acquisition may present additional challenges and opportunities for Equity Group, which reported profits in excess of $280 million in the first nine months of 2022 under the leadership of Kenyan multimillionaire businessman James Mwangi.

Mwangi, who has been instrumental in the growth and transformation of Kenya’s financial services industry, owns a sizable 3.38-percent stake in Equity Group.

Continue Reading

Trending