Category: Business Daily

As the first phase of Kenya’s flagship Financing Locally Led Climate Action (FLLoCA) programme ends, its achievements offer valuable lessons for the next phase.

Over five years, the initiative has supported more than 2,200 community projects, according to the National Treasury, backed by a World Bank credit of US$150 million and other development partners. All 47 counties have also enacted laws establishing county climate change funds.

However, the programme’s next phase must strengthen communities’ influence over funding decisions, project implementation and accountability. Ward Climate Change Planning Committees have involved residents in identifying climate risks and proposing solutions.

A September 2026 assessment by Natural Justice in Makueni, Kisumu, Isiolo, Kilifi and Nyandarua counties found that more than 91 percent of respondents had participated in climate risk assessments and ward-level planning.

Yet participation does not guarantee influence. The assessment found that funding often favoured larger infrastructure projects managed through county systems, while smaller community priorities received less attention. Political interests also influenced implementation priorities.

Communities should have a meaningful say in determining which projects receive funding. While county officials and engineers must uphold procurement rules, technical expertise should complement, not override, residents’ priorities. Civil society organisations also have a role in protecting community interests.

As FLLoCA moves towards a potential second phase in 2027, counties should publish ward-level priorities alongside approved projects and explain significant changes. Project sites should display costs, contractors, timelines and expected outcomes. Residents should also be able to monitor implementation and raise concerns before final payments are approved.

Independent community monitoring and impartial grievance mechanisms are equally essential. The assessment found that only Makueni had allocated resources to ward committees for project monitoring.

Counties must also demonstrate how projects address the needs of women, young people, per-sons with disabilities and pastoralist communities.

Small-grants programmes, supported by financial training and technical assistance, could help local groups implement adaptation projects while maintaining accountability.

Employers across East Africa routinely praise those employees who they see arriving early, leave the office later than others, responds to emails at all hours, work through lunch times, and always appear busy at their workstation.

Then when it becomes time to dish out promotions, those same managers look around the office and tend to remember who they view as working the hardest.

However, management must stop and ask whether work hard has any relationship to performing well too.

Prolific management researchers Chad Van Iddekinge, John Arnold, Herman Aguinis, Jonas Lang, and Filip Lievens published an often cited and highly impactful study that has really changed the thinking of human resources researchers and practitioners across the world.

The study defines what workplace effort actually means and what makes employees actually exert that effort. Then even more importantly, does work effort really produce better professional performance.

While such questions may seem obvious to the casual observer, these conundrums have fascinated and challenged researchers and management consultants for decades. Often people intermix three concepts altogether but are actually very different and distinct from each other: motivation, effort, and performance.

Motivation happens within an employee’s head. It is what they eagerly want to achieve in a set of work tasks. While effort then encompasses what staff subsequently does each day in their roles. Then last, performance concerns how well the actions taken on the tasks actually contribute toward accomplishing the work that needs to get done.

So, someone can really be highly motivated but surprisingly exert very little effort, while someone else could put enormous effort into their job but still perform terribly. As an example, a salesperson could make 70 cold calls to potential new insurance clients in a week while a different sales agent only makes 25. But who actually works harder?

One may think the first salesperson worked harder. But maybe the second one was more intentional, spent time networking and developing social capital to secure high probability prospective clients to call rather than just merely calling random people out of the blue. As a result, the second salesperson might convert 10 of the calls to new clients while the first one maybe only 5. Therefore, the second sales agent in reality performs better.

The research utilises the above distinction between effort and effectiveness. While effort concerns how hard someone works, performance concerns how well that same work contributes toward the organisation’s goals.

The distinction between the two becomes important because managers often only reward visible effort instead of real performance. We can quite easily notice a colleague who stays late in the office, but it is harder to see someone who intelligently finishes everything early.

So, the research divides effort into three different categories. First, what direction is the effort? Essentially, where do you put your effort.

Secondly, what kind of intensity is the effort? Meaning how hard do you work. Third, the persistence involved with the effort. How long do you keep going?

Of the big three, managers often neglect to notice and investigate direction the most. An accountant might receive 10 different tasks, and he works extremely hard for eight hours, but those whole eight hours are spent on the least important task. So, his prioritisation incompetence means he has terrible direction with his effort. But all the while his intensity and persistence are both excellent.

In contrast, a different worker first meticulously determines which two out of the 10 activities will produce her the most, so she completes only those and then moves down the priority list.

Managers may just simply describe the difference between the two workers as working hard versus working smart. But research explains deeper in that direction means selecting where to put your energy, while intensity and persistence both concern how hard you then pursue it.

In summary, do not merely ask your staff whether they work hard. But instead, ask what they work hard on doing.

The shares of NCBA Group will be suspended from trading for nine days starting Wednesday to facilitate the transfer of a 66 percent stake in the Kenyan bank to South Africa’s Nedbank Group.

The share price of the Nairobi Securities Exchange-listed firm closed at Sh85.75 on Monday.

‘NCBA Shareholders and the public are notified that NCBA shares will be suspended from trading from on or about the close of business on Wednesday, 21 October 2026 to the close of business on Monday, 2 November 2026 to enable the reconciliation of the Share Register,’ NCBA said in a statement.

‘The transfer of NCBA shares from NCBA shareholders to Nedbank will be through a block trade executed through the Block Trade Board of the NSE on Tuesday, 3 November 2026. Settlement of Nedbank Shares and dispatch of cash payments to NCBA Shareholders will take place from Tuesday, 3 November 2026.’

The transaction has cleared all the hurdles including receipt of regulatory approvals.

The South African bank is buying the NCBA stake under a hybrid compensation plan in which 80 percent of the consideration is made via a share swap, and 20 percent in cash.

The stock option was done at a conversion rate of 4.02994 shares for every 100 NCBA shares. The Nedbank shares were priced at 250 Rand (Sh1928.50) using the deal’s exchange rate, while the cash option was priced at up to Sh105 per NCBA share.

Nedbank earlier estimated it will pay Sh23.23 billion in the cash option, and hand the NCBA sellers 43.63 million of its shares for the equity option. The final details are expected to be announced soon.

‘Nedbank Group will announce the final figures in respect of the cash portion paid and new Nedbank Group shares issued in settlement of the consideration … on or about Thursday, 5 November 2026,’ the multinational said in a statement.

‘Nedbank Group expects NCBA’s financial results to be consolidated into the Nedbank Group’s financial results in the fourth quarter of 2026.’

NCBA shareholders will have the option of either holding onto the Nedbank stock for dividends and future capital gains, or they can sell up immediately and book the gains that have accrued since January. Nedbank’s stock closed at 288.6 Rand on Monday.

Nedbank managed to achieve its target of a 66 percent stake or 1.087 billion shares, handing it control of Kenya’s fifth largest bank by assets.

The multinational received initial acceptances from NCBA owners amounting to 920.65 million shares, or 55.88 percent of the Kenyan bank’s issued shares. Participating investors then exercised an option to sell an additional 395.7 million shares (24.02 percent) in excess applications to help fill the gap.

In order to limit itself to the planned 66 percent stake, Nedbank rejected 228.99 million shares from the excess applications. NCBA will remain listed on the NSE post-transaction, with minority investors holding a combined 34 percent stake in the bank.

The National Cereals and Produce Board (NCBP) plans to establish 21 warehouses run by private investors across nine counties in a strategy aimed at fighting exploitative middlemen and brokers.

The Treasury said the depots will be set up in Tharaka Nithi, Nairobi, Nandi, Kwale, Lamu, Narok, Migori, Nakuru, and Trans Nzoia counties under a public-private-partnership (PPP) arrangement.

The NCPB will drive the concession deals under the warehouse receipts system (WRS).

‘The project entails development of new (green-field) warehouses, refurbishing a brownfield bulk storage silo, and managing the operation and maintenance (O and M) of existing facilities certified under the warehouse receipts system (WRS),’ the PPP Unit of the National Treasury said.

The WRS is an arrangement in which commodity owners, traders or aggregators deposit their produce in a certified warehouse and are issued with documents known as warehouse receipts as proof of ownership. The receipt guarantees the quantity, quality, and ownership of a stored commodity.

NCPB said the receipts may be negotiable or non-negotiable. Negotiable receipts allow transfer of ownership of that commodity without having to deliver the physical commodity, while non-negotiable receipts must be endorsed upon transfer.

‘The warehouse receipt system, under implementation, is envisaged to play a central role in ensuring that the grain market becomes more responsive and structured in trading with an overall aim of strengthening the commodity supply chain and trading regime,’ NCPB said in a brief.

These receipts can be used as collateral for a loan or traded as negotiable instruments. As producers keep their grain in stores, they are issued with receipts that they can cash at financial institutions participating in the programme to meet their financial needs. The amount is recovered after they selling their produce.

The NCPB piloted the WRS concept in Kitale, Eldoret, Nakuru, Nairobi, and Meru.

As of September 2026, there were stocks of sunflower, white maize, green grams, soybeans, and coffee held in certified warehouses in Nairobi, Uasin Gishu, and Nakuru counties.

The government launched an Electronic Warehouse Receipt System Central Registry (eWRS-CR) in February 2026 in partnership with TradeMark Africa, with funding support from the British High Commission in Kenya.

At the time of the eWRS-CR launch in February, the Trade ministry revealed that 114 warehouse receipts covering nearly 600,000 kilogrammes of deposited commodities had already been registered. The WRS, which are negotiable and transferable, will be mainly traded on the Kenya National Multi-commodity Exchange (Komex).

The commodities exchange, which is regulated by the Capital Markets Authority, is an online marketplace where buyers and sellers can trade in commodities with an assurance of quality, delivery, and payment.

Instruments at the exchange will include spot trading in commodities, with the introduction of derivatives trading in futures, options, and index trading later on. Sectors will include agriculture, metals, minerals, and energy before diversifying into currencies and other asset classes.

The Komex will operate depots where farmers will deposit produce for storage pending a decision to sell when prices improve. Traders rarely deliver any physical commodities through a commodities exchange. Instead, they trade futures contracts, where parties agree to buy or sell a specific quantity of the commodity at an agreed-upon price, regardless of what it currently trades at,

The United States has raised its travel advisory for Kenya to Level three, urging its citizens to reconsider trips to the east Africa country after escalating its assessment of health risks.

The US State Department announced the change on October 19, moving Kenya from Level two, which advises travellers to exercise increased caution, to Level three, which recommends reconsidering travel.

The latest advisory retains warnings over crime, kidnapping, terrorism and unrest, alongside health and road-safety concerns.

The escalation comes as Kenya grapples with an outbreak of the Bundibugyo strain of Ebola, with the disease spreading beyond the initial imported case to people who had contact with the patient, raising the stakes for the country’s public-health response and international travel reputation.

‘Medical services in Kenya are limited. They are often unavailable in rural areas. Medical facilities in Kenya often lack sufficient medicine and equipment,’ reads the advisory in part.

‘Except for a few private medical facilities based in the large urban centers with enhanced capability, many health issues may require medical evacuation at your own expense. Medical facilities will usually deny service if payment is not made upfront.’

Although the advisory’s record of the level change attributes the escalation to health risks without naming the disease, its wider health guidance references a US Centers for Disease Control and Prevention travel health notice for Ebola Bundibugyo virus disease in Kenya.

The shift places Kenya closer to Level four, the State Department’s highest category, which advises Americans not to travel to a destination.

The previous Level Two advisory was issued on July 28, 2026, with the same broad risk indicators of crime, kidnapping or hostage-taking, terrorism, unrest and health.

The advisory has direct implications for tourism, one of Kenya’s major sources of foreign exchange, as international visitors weigh safety concerns when choosing destinations for holidays, wildlife safaris and business trips.

Kenya earned about Sh500 billion from tourism in 2025, when it received 2.7 million international visitors and 5.2 million domestic travellers, according to the Tourism Research Institute’s sector performance figures.

The US is particularly important to the industry as it was Kenya’s largest source market in 2024, accounting for 306,501 visitors or 12.8 percent of international arrivals.

A higher travel warning could prompt some American visitors to postpone trips, seek alternative destinations or demand additional assurances from tour operators, hotels and airlines, potentially affecting bookings and businesses that depend on international tourists.

Read: How bungled Nanyuki airstrip contract drew Sh1.2bn blow for KAA

Tourism businesses also face the risk that health concerns could overshadow Kenya’s wildlife, beaches and other attractions at a time when the country is seeking to grow international arrivals and tourism earnings.

A worsening international perception of Kenya’s health risks could further complicate business travel, conferences and investment visits.

Kenya confirmed its first imported case of Bundibugyo virus disease on October 6, involving a Kenyan who had been living in the Democratic Republic of Congo (DRC) and travelled to Nairobi through Uganda. He died hours after arriving in Nairobi.

By October 19, the number of confirmed infections had risen to eight, including health workers and people linked to the first patient.

Health authorities have intensified contact tracing, quarantine and surveillance as they seek to contain the infections.

As of October 18, officials said 128 of 130 identified contacts were in quarantine, with no evidence of wider community transmission reported at that point.

The outbreak is linked to a wider epidemic in the DRC, where the World Health Organization (WHO) has reported thousands of confirmed cases and deaths.

The Bundibugyo strain has no approved vaccine or specific treatment, adding to the challenge of managing the disease.

The US advisory has also mapped out areas with escalated risks of crime and kidnapping attacks, including Nairobi’s Eastleigh and Kibera neighbourhoods, while the counties of Garissa, Wajir, Mandera, Lamu, Tana River, and Kilifi have been flagged for terrorism risks.

Others include West Pokot and Turkana counties, which have been flagged for crime and unrest risks.

The World Health Organization (WHO) African Region has one of the world’s lowest tobacco-use prevalence rates. In 2025, about 8.9 per cent of people aged 15 and above were projected to use tobacco, meaning roughly nine in 10 adults did not. This achievement reflects decades of tobacco-control laws, taxation and public education.

Against this backdrop, a fundamental question arises: if vaping is intended to reduce harm among existing smokers, why are these products marketed to the much larger population that does not use tobacco?

Harm reduction should be measured by fewer cases of disease, disability and premature death, not product switching or sales.

Nicotine remains highly addictive and can harm adolescent brain development, raise heart rate and blood pressure, and affect a developing baby during pregnancy. E-cigarette aerosols also contain fine particles, flavouring chemicals and metals that can damage the lungs. Nicotine pouches carry risks, including gum irritation, dependence and accidental poisoning among young children.

Evidence that e-cigarettes can help some smokers quit comes largely from controlled studies involving willing participants, defined products and professional support. That differs sharply from commercial markets where products are widely advertised, sold in numerous flavours and some-times supplied without adequate age checks or counselling.

Similarly, Sweden’s experience with alternative nicotine products cannot automatically be replicated in Kenya. Differences in smoking histories, culture, income and regulatory capacity matter. Evidence of benefits for individual smokers under controlled conditions does not prove that expanding commercial nicotine markets will improve population health.

Policymakers must also scrutinise who funds the research used to shape regulation. Kenya is a Party to the World Health Organization Framework Convention on Tobacco Control. Article 5.3 requires governments to protect public health policies from the commercial interests of the tobacco industry. Funding, study design and potential conflicts of interest should therefore be dis-closed.

Marketing tactics, including celebrity endorsements, music festivals, motorsport sponsorships and sweet flavours, raise further concerns about attracting young people and non-smokers. For someone who has never smoked, vaping is not a transition away from cigarettes but the introduction of a new health risk and potential nicotine dependence.

Kenya should strengthen regulation of emerging nicotine products. Any vaping products intended to support smoking cessation should be used within controlled, time-limited programmes with appropriate professional support.

Ultimately, the question is whether promoting vaping will reduce nicotine-related disease and death across the population. Until independent evidence demonstrates that benefit outweighs the risks of new addiction and prolonged dependence, commercial expansion should not automatically be presented as harm reduction.

South Africa’s Vodacom Group says it will retain its controlling 55 percent stake in Safaricom as an appeal of a High Court judgement nullifying its acquisition of an extra 20 percent stake in the Kenyan telco continues.

The High Court issued its decision on September 15, 2026, noting that the National Treasury concealed material information regarding the sale of its 15 percent stake in Safaricom for Sh204.3 billion.

This included the fact that it resulted in Vodacom taking a controlling 55 percent stake in the Nairobi Securities Exchange-listed firm.

The South African firm also acquired a five percent stake in Safaricom from Vodafone Group at a cost of Sh68.1 billion, lifting its ownership from the previous 35 percent.

An application by Vodacom and other affected parties came before Nairobi’s Court of Appeal on October 13, 2026 seeking a stay order against the High Court’s decision.

‘The [Court of Appeal] decided not to determine the application but instead recorded to fast-track the substantive appeal. The prevailing status quo in respect of the shares and purchase consideration shall be maintained pending the hearing of the appeal,’ the Midrand-based multinational said in a trading update.

‘The effect of the order is that [Vodacom] remains the registered holder of the Safaricom shares acquired from Government of Kenya (GoK) on 30 June 2026, and the corresponding purchase consideration paid to GoK is to be preserved, pending the hearing of the appeal.’

Vodacom bought the additional Safaricom stakes through its investment vehicle Vodafone Kenya Limited (VKL).

The South African firm says it remains confident in the strategic rationale for the additional investment in Safaricom, adding that it will update its investors on any material developments relating to the appeal process.

The government’s partial sale of its stake in Safaricom stake had already drawn legal action but the Attorney-General was granted an application to the Court of Appeal to lift a freeze on the deal on June 26, 2026, enabling the transaction to be closed two business days later.

Vodacom acquired the government’s shares through a block trade on the NSE on June 30, 2026, the same day it also bought Vodafone’s shares through VKL.

The High Court’s three-judge bench held that the deal had been presented as a partial divestiture when in reality it amounted to a takeover that gave Vodacom effective control of Safaricom.

The court declared the divestiture invalid, null and void, quashed all approvals relating to the transaction and ordered that the 15 percent stake be restored to the Government of Kenya on behalf of the people.

‘A declaration is hereby made that the partial divestiture of the 15 percent of the Government of Kenya shares in a camouflage merger or acquisition and takeover of Safaricom Plc is in contravention of the Constitution and the law,’ said the court.

The court noted that under the arrangement, the South African multinational’s ownership in the Kenyan telco rose to 55 percent after taking full ownership of VKL through which it holds the shares in the Kenyan telco.

The judges found that this critical information was not adequately disclosed to the public, the Cabinet or Parliament.

‘A declaration is hereby made that the partial divestiture of the 15 percent of the Government of Kenya shares in Safaricom PLC was marred with obscurities on the proposed buyer, misrepresentations and concealment of material information on the nature and effects of the partial divestiture in violation of the principles of integrity, transparency,’ said the court.

The court also raised concerns about national security, noting that Safaricom operates critical infrastructure, including election transmission systems, government payment platforms, mobile money services and stores the personal data of millions of Kenyans.

‘In the circumstances, even with regulatory safeguards, there is no guarantee that would prevent foreign and external influence or interference with the governance systems, personal security and data,’ the court said.

The judges added that any perception of external influence over election transmission systems could undermine public confidence in the democratic process. They held that transferring effective control of such infrastructure to a foreign entity without a prior national security assessment violated the government’s constitutional obligations.

Top parastatals have sold a combined 24.76 percent stake in Kenya Pipeline Company (KPC) to an identified foreign investor less than eight months after spending billions to buy the shares.

A source familiar with the deal said at least eight parastatals sold their shares in the firm, which were listed on the Nairobi Securities Exchange (NSE) on March 9, to a foreign institution.

The State pressured cash-rich parastatals in February to buy into the initial public offering (IPO) of KPC to avoid the sale being declared invalid after high- net-worth investors snubbed the deal.

This saw the National Social Security Fund (NSSF) buy shares worth Sh38.5 billion, followed by Public Servants Pension Scheme (Sh13 billion), County Workers Pension Fund (Sh3.6 billion) and Unclaimed Financial Assets Authority (Sh3.2 billion).

Pension funds for Kenya Power, KPC and Kenya Ports Authority (KPA) workers also participated heavily in the offer.

President William Ruto on Tuesday hailed the transfer of the 4.5 billion shares of KPC through the Nairobi bourse as a mark of confidence on Kenya’s capital markets.

‘In demonstration of growing confidence, private investors acquired 25 percent stake in Kenya Pipeline Company from public entities,’ President Ruto said in his address at the Mashuja Day fete, without disclosing the identity of the parastatals.

About 13 parastatals splashed Sh64.23 billion on the Kenya Pipeline IPO, taking a 38.35 percent stake in the firm.

The NSSF has an estimated 23.3 percent stake in KPC, Public Servants Pension Scheme (7.94 percent), County Workers Pension Fund (2.2 percent) and Unclaimed Financial Assets Authority (1.98 percent).

The IPO had to raise at least Sh53.1 billion from more than 250 investors for it to proceed, a target that had not been achieved as the offer raced to a close.

This forced the State to urge parastatals, the State-backed pension scheme and the Ugandan government to save the IPO from collapse.

At Sh9.02, the State-owned firms sold the shares at nearly the same offer price as the listing of KPC at the Nairobi bourse.

The government priced the Kenya Pipeline IPO at Sh9 per share for the offer that opened on January 19 and ran until February 24, with the shares opening trading on the Nairobi bourse on March 9.

In the end, Uganda, together with 13 State-backed pension schemes and agencies, pumped in Sh95.8 billion of the required Sh106.3 billion, according to confidential documents seen by the Business Daily.

The offer received a 105.7 percent subscription ?rate, raising Sh112 billion against the State target of Sh106 billion.

Without the NSSF, Uganda and the pension fund, the IPO would have collapsed on failure to hit the success level.

About 90 percent of the top owners of KPC bought their shares through proxies during the firm’s IPO, keeping the identity of the investors anonymous.

Regulatory filings show that 18 of the top 20 shareholders of KPC are under nominee accounts.

Nominee accounts are registered to hold shares on behalf of the true owners, a structure used globally and at firms listed at the Nairobi bourse to mask the identity of beneficial owners.

The NSSF and the State agencies also split their stake under several nominee accounts, masking their position as KPC’s largest shareholders.

The success of the offer was dented by the apathy among foreigners, high-net-worth investors in the private sector, retail investors and oil marketers, who many believed considered Kenya Pipeline a strategic investment.

Local retail investors bought shares worth Sh4.1 billion against their allocation of Sh21.2 billion stocks, while foreigners spent a measly Sh32.7 million compared to their target of Sh21.2 billion.

Oil marketers took shares worth Sh22.9 million or 0.14 percent of the Sh15.9 billion stocks allocated to the dealers who rely on the pipeline to feed the market.

The concentration of local institutional investors and Uganda implied that the IPO was seen as a long-term strategic investment.

The KPC transaction comes after a series of large block trades at the NSE, as the bourse seeks to deepen liquidity and improve transparency around big share transfers.

The most notable was the Sh204.3 billion sale of a 15 percent stake in Safaricom by the government to Vodacom, involving 6.009 billion shares.

It was the largest single transaction ever conducted on the bourse and accounted for the bulk of equity market turnover around the time it was executed.

Diageo has also used the block-trade mechanism to increase its stake in East African Breweries (EABL), acquiring 14.97 percent of the brewer for Sh22.73 billion in 2023 and raising its total holding to 65 percent.

KPC’s net profit grew 13 percent to Sh11.58 billion in the year to June 2026, allowing the firm to splash Sh5.81 billion in dividends.

An arm of the UK government is buying a 6.5 percent stake in Quickmart through the retailer’s initial public offering (IPO) for Sh1.94 billion ($15 million), marking another bid by foreign anchor investment.

The United Kingdom’s Foreign, Commonwealth and Development Office (FCDO) announced it will buy 260 million of the two billion shares on offer.

It will buy the shares through MOBILIST, a UK government programme that uses taxpayers’ cash to buy stakes in private companies, which is seen as a shift from handing out foreign aid.

The FCDO will join the International Finance Corporation (IFC)-the World Bank’s private investment arm- as a cornerstone investor in the Sh15 billion IPO, which has valued Quickmart at Sh30 billion.

The IFC has also committed to buying a similar stake of 6.5 percent for Sh1.94 billion, providing a boost in confidence to an IPO, whose offer will close on October 30.

For the IFC, this is not the first equity investment in a Kenyan retailer, having participated in a consortium that bought and sold a 31.5 percent stake in Naivas between 2020 and 2022 for a tidy profit.

IFC and MOBILIST are hoping for a similar outsized return from Quickmart upon its exit, on the back of the retailer’s expansion plans and steady dividend payouts.

‘We welcome MOBILIST as an investment partner as we broaden Quickmart’s ownership. With MOBILIST’s support, our proposed listing will help realise Quickmart’s ambition to create long-term shareholder value’, Quickmart Plc CEO, Peter Kang’iri, says.

The Quickmart deal marks MOBILIST’s latest investment via the Kenyan public markets following its role as the cornerstone investor in the March 2026 listing of Kenya’s debut US dollar-denominated industrial Real Estate Investment Trust (REIT) floated by Africa Logistics Properties.

MOBILIST invested $9 million (Sh1.2 billion) in the Africa Logistics Properties industrial REIT, which raised Sh3.82 billion from investors.

Cornerstone investors are institutional or high net worth investors who agree in advance to buy a specific stake in an IPO, signaling confidence in an offer to other buyers.

The IFC, however, said its participation in the sale is not an endorsement or recommendation to other investors to participate in the IPO.

In Quickmart’s IPO, current owners who include Mauritius-registered private equity fund Adenia Partners, the founders of Quickmart and Tumaini supermarkets and the retailer’s chief executive officer Peter Kang’iri are offloading two billion shares, equivalent to a 50 percent stake.

Their shares are held through an investment vehicle known as Sokoni Retail Kenya Limited (SRKL).

The IPO could, however, usher in other large investors into the business, given the allocation criteria that sets aside 35 percent of the offer shares for Kenyan institutional investors, equivalent to an ultimate holding of 17.5 percent of the company’s issued shares.

Local retail and foreign investors have been allocated 20 percent each, East African Community investors 12 percent, and the IFC 13 percent. These limits can be adjusted depending on subscription levels per investor category.

Quickmart is now the second largest retail chain in Kenya behind Naivas by store count and turnover, with an estimated 15 percent share of the market. The company has a current store count of 72, in 16 counties.

In the year ended December 2025, Quickmart reported a 33 percent growth in net profit to Sh1.51 billion. Sales rose by 9.3 percent to Sh50.43 billion in the year.

The retailer paid its shareholders a dividend of Sh1.65 billion, representing a payout ratio of 109 percent and is aiming to distribute at least 80 percent of its earnings to shareholders in the coming years.

Kenya has become a saving nation. A generation ago, most retirement savings sat in an underfunded provident fund and a few large occupational schemes.

Today, the Retirement Benefits Authority’s June 2026 industry brief reports total pension assets under management of Sh3.2 trillion, surpassing the Sh3 trillion mark for the first time.

This massive capital pool now accounts for 17.64 percent of Kenya’s GDP, climbing steadily from 16.05 percent in December 2025. Kenya’s banking sector holds a further Sh8.9 trillion in assets.

Add insurance, collective investment schemes and individual savings, and the picture is of a country that has quietly built one of sub-Saharan Africa’s largest domestic capital pools.

Pension funds invest 52.14 percent of their trillions in government securities, while 18.59 percent is in guaranteed funds. Despite this, infrastructure, which Kenya claims it can’t finance, makes up for approximately 0.02 percent of the portfolio.

There is still inadequate allocation to infrastructure within the pensions scheme compared to the regulatory ceiling of 10 percent. Recommendations have suggested revising this to 30 percent. Nonetheless, the current allocations are insignificant when compared to both the existing regulatory ceiling and the recommended one.

Pension trustees are expected to consider their fiduciary duty to members. They operate much like a corporate board. The scheme’s investment committee, made up of the pension trustees, consults with fund managers who must prove to the committee that the project can deliver predictable returns within a certain time frame.

The fiscal space has narrowed. Traditionally, Kenya has funded development activities through annual government budgets, sovereign borrowing, development finance institutions, and public-private partnerships (PPPs). While each plays a role, none can fund infrastructure projects alone.

The country’s debt stood at around Sh12.3 trillion at the end of 2025, up from Sh9.15 trillion at the end of 2022. Debt service will amount to Sh1.5 trillion out of the proposed Sh4.8 trillion budget for 2026/27.

The national budget should fund what only it can: schools, hospitals, community roads, and water points that serve the public but do not generate enough revenue to attract private capital. Commercially viable infrastructure, such as toll roads, airports, ports, energy facilities, and the digital backbone, should shift to a model that attracts equity and debt based on future revenues rather than future taxes.

McKinsey identified a paradox in Africa’s infrastructure markets: funding is available, the pipeline is large, and the need is clear, but 80 percent of projects fail at the feasibility and business-plan stage, and fewer than 10 percent reach financial close. In many cases, projects stall before investors can assess or finance them.

Kenya illustrates this gap: the PPP Directorate’s April 2026 status report lists 51 projects valued Sh1.7 trillion. Of these projects, 10 are in the implementation stage, meaning financing, contract signing, and construction are underway.

The remaining 41 projects, which make up more than 80 percent of the Sh1.7 trillion project pipeline, are still at various stages of preparation, procurement, or approval.

Since the establishment of PPP in 2013, Kenya has mobilised only $ 1 billion in private capital over 13 years.

The IMF indicates that almost half of more than 1,000 government-implemented projects stalled because of the Sh1 trillion required to implement them. Development expenditure was 58.3 percent of plan in March 2026 and just 37 percent in the first half of 2025/26. Unspent allocated funds are not a fiscal constraint.

An infrastructure project must pass tests unrelated to its ambition to attract institutional funding. The land should be legally owned, with no competing claims. The project’s demand should be analysed using objective data, not the ministry’s estimate.

The revenue should be secured through enforceable contracts or regulations. Risk, construction, operation, revenue shortfall, and currency should be distributed so that both equity and debt investors find it acceptable. Multilateral lenders require an environmental and social impact analysis that aligns with their standards.

Management should be able to implement the project.

Project preparation for developing countries usually takes 5-10 per cent of the project’s total value, but limited development budgets often make it the first thing sacrificed. As a result, projects are announced but never reach financial close because they were not properly prepared.

Financial close is an important accomplishment. This does not mark the end of the process. A pension fund which is investing in projects for fifteen or twenty-five years is not bidding on a construction contract.

The fund is bidding for the project’s entire operating life: the effectiveness of tariff adjustment mechanisms, the ability of off-takers, and the longevity of the institutions and regulations governing revenue streams over the concession period.

Kenya’s PPP regime, grounded in the PPP Act and implemented by the PPP Directorate, has increasingly laid the foundations for this: long-term commitments backed by sovereign governments to deliver predictable returns over the full life of the investment.

A case in point is the Nairobi Expressway project. This is a 27-year toll concession under Kenya’s PPP regime, with one of the best-structured termination clauses in sub-Saharan Africa and a transparent, agreed-upon method for compensating investors for the full investment period. The traffic numbers continue to confirm the demand assumptions.

The 2023/24 operating result testifies to the inflated costs of foreign-currency borrowing. For long-term capital providers, the Nairobi Expressway has catalysed the structuring conversation Kenya’s PPP market is now mature enough to have on behalf of the next generation of infrastructure investors.

Investors don’t demand a risk-free environment. They demand an environment where risks are explicitly identified, legally allocated, and separately manageable. The Kenyan institutional framework provides that structure, and Kenya’s track record of honouring long-term sovereign commitments across successive administrations reinforces it.

Well-designed first-loss coverage or risk guarantees will often be more effective than a coupon premium in attracting long-term financing because institutional investments are constrained by certainty, not yield. We are not after eliminating commercial risk for the investor, but rather ensuring that the risks on the investor’s balance sheet are ones it can price and that the mechanisms to manage them are ones it can rely on.

Contracts and institutions help hedge projects, but these must be resolved before capital is committed.

These consist of revenue floors which are capped, rule-based and transparent; conservative demand forecasts; payment security of the utility consumers, which is best done by development finance institutions; protection against tariff changes and changes in laws; termination provisions for all outstanding senior debts, which are enforceable; lender step-in rights and independent dispute resolution, which do not rely on the goodwill of the sitting government.

The role of investment banks

Investment banks sit between Kenya’s savings and its projects, and their value lies in making the second durable for the first. Banks can ring-fence revenues and design the vehicle, waterfall, reserve, and credit enhancement to withstand stress. They can assess a sponsor’s projections against conservative cases before investors do and advise government on terms that survive a change of administration, from tariff mechanisms to termination compensation.

They can present the project to the trustee’s investment committee in their language, find an anchor investor base, get the ratings, and list on the Nairobi Securities Exchange. But the process does not stop there. Reporting, surveillance, and recycling matured assets back into the capital markets help keep the structure honest, as long as the conflict between advising on and placing the same deal is handled openly.

Investment banks can add the structure that keeps those savings protected once the project is operational.