HF Group’s Rights Issue over-subscribed by 138% to secure Ksh.6.38B

Financial solutions provider HF Group Plc (NSE: HFCK) has achieved an over-subscription on its recently concluded Rights Issue, with a total subscription performance rate of 138.32%.

Robert Kibaara, the Group’s CEO  termed the outcome of the Rights Issue “an overwhelming success” for the company.

“We went to our shareholders asking for additional investment of Ksh.4.6 billion, upon conclusion of the process, we have received applications of Ksh.6.38 billion. We are now firmly on the path to powering our next phase of business growth,” he said.

According to the CEO,  this capital will enable the Group to expand its product offering, strengthen its technology platforms and position itself for future growth. HF Group is on its third straight year of profitability.

The Rights Issue priced at Ksh.4.00 per share, was structured to offer shareholders two (2) new ordinary shares for every one (1) existing ordinary share held, with the shareholders having the option to apply for additional shares.

 In addition, it had a green shoe option of up to 30% (equivalent to 384,614,168 shares) to accommodate any potential oversubscription. The Grand Total Number of New Shares applied for under the Rights Issue (Entitlement Shares + Additional Shares) was 1,595,995,966 with a total gross value of Ksh.6,383,983,864.

On her part, HF Group Chairperson Prof.  Olive Mugenda said “This is a great show of confidence by our shareholders. Our key shareholders Britam and NSSF as well as our retail shareholders demonstrated immense confidence in the Group by taking up their rights. We have now set up a foundation for growth and we look forward to unlocking value for our shareholders in the short term.”

“These funds will go towards expanding the growth of our business. 85% will go towards this while 15% will go towards technology and digitization of the business to increase efficiency and customer experience,” Robert Kibaara said.

With this successful capital injection, the Group is on course to fully comply with the new capital regulations that will see banks expected to grow their capital base to Ksh.10 Billion by 2028.

The shares will be uploaded to shareholders’ CDS accounts on Monday 23rd December with trading set to commence on the Nairobi Securities Exchange on Tuesday December 24th 2024.