A Nairobi-based company providing guarantees to support sustainable growth enterprises has received a significant boost following a Sh1.3 billion (US$10 million) strategic equity investment from the African Development Bank. The investment in Dhamana Guarantee Company follows an anchor investment from the UK Government-backed Private Infrastructure Development Group through its subsidiary, InfraCo Africa.
In addition to this, Dhamana will also receive equity investments from County Pension Fund Financial Services (CPF) and technical assistance from Financial Sector Deepening Africa (FSD Africa) and Cardano Development. During the signing ceremony in Nairobi, Solomon Quaynor, the African Development Bank’s Vice President for Private Sector, Infrastructure, and Industrialization, said: “The African Development Bank’s investment in Dhamana underscores the catalytic role of credit enhancement companies in leveraging local currency infrastructure financing. We aim to replicate this business model in markets across Africa with partners like the Private Infrastructure Development Group.”
Dhamana plans to use the funds to support key sectors such as transport, water, renewable energy, and waste management. The company is also committed to driving green and sustainable financing across East Africa, offering credit guarantees to stimulate private investment in infrastructure. By focusing on businesses that enhance citizens’ daily lives, Dhamana aims to increase access to affordable finance, lower capital requirements for projects, and contribute to the Sustainable Development Goals.
Quaynor cited InfraCredit in Nigeria as a successful example of this type of credit enhancement company. He added, “The investment in Dhamana aligns with the Bank’s goal of mobilizing financing through innovative vehicles like pension funds, sovereign wealth funds, and insurance companies for infrastructure development across Africa.”
InfraCo Africa CEO Gilles Vaes noted: “Building on the success of other PIDG-supported credit enhancement facilities in Nigeria and Pakistan, Dhamana will demonstrate the value of such a facility in East Africa, opening opportunities for investors and clients. Importantly, Dhamana will engage new partners to address the climate crisis and accelerate progress on the UN Sustainable Development Goals.”
Dhamana CEO Christopher Olobo expressed gratitude to the investors and supporters, saying, “With the backing of the Private Infrastructure Development Group, Cardano Development, FSD Africa, CPF Financial Services, and the African Development Bank, we’ve developed Dhamana as a catalyst for sustainable long-term finance in the region. Our local currency guarantees will connect untapped capital pools with East Africa’s economy, improving lives and enabling local investors to support Paris-aligned initiatives.”
