In December 2019, GuarantCo provided a USD 50 million partial credit guarantee to a private sector European institutional investor to support Kacific to own and operate its first shared geostationary earth orbit, high-throughput satellite and a partial credit guarantee to investors in Acorn’s KES 5 billion note programme to fund the construction of accommodation for 5,000 students in Nairobi in October 2019.
GuarantCo and PIDG Technical Assistance support investees Kacific Broadband Satellites Group and Acorn Holdings Limited to respond to the COVID-19 crisis in Asia Pacific and Kenya
GuarantCo, with funding from the Private Infrastructure Development Group (PIDG) Technical Assistance, is providing a USD 500,000 grant to support Kacific Broadband Satellites Group (Kacific) efforts to respond to the COVID-19 pandemic by distributing satellite communication systems. These systems will allow free connections of up to 1,000 rural health posts and clinics across Asia Pacific.
A further USD 109,000 PIDG TA grant was provided to Acorn Holdings Limited (Acorn) which will allow them to continue operations on three student accommodation construction sites in Nairobi, complying with stringent rules and keeping their workforce in employment.
With its new broadband satellite Kacific1, delivering fast, affordable, and accessible connectivity, financed by GuarantCo and the Asian Development Bank in December 2019, Kacific covers 25 lower income and low middle-income countries across the Asia Pacific region. In these countries, rural medical facilities still rely on phone/SMS as primary mode of communication. An internet connectivity will therefore enable more effective monitoring and communication during the pandemic. A long-lasting impact will be that broadband connectivity will enable these sites to conduct telemedicine more effectively, allowing national health systems to decentralise services more effectively to rural areas. Vanuatu will be the first country to take advantage of the service, with several countries expected to follow.
Following a Government of Kenya directive, mid-March 2020, all universities were ordered to close so Acorn, the first purpose-built student accommodation (PBSA) provider in Kenya, shut all its operating properties. Acorn also closed its three operational construction sites from mid-March to mid-April to implement Ministry of Health guidelines which enabled the company to institute recommended public health measures on hygiene, social distancing, access protocols, screening and medical emergencies. The construction sites have re-opened with a minimum staff at each site but with better access to PPE and sanitising equipment, made possible with the support of the PIDG TA grant. Acorn plans to increase the numbers of workers per site to allow the company to meet the completion deadlines and complete affordable, environmentally friendly student housing and sustain local jobs.
A number of other PIDG Technical Assistance grants for GuarantCo portfolio clients are currently being reviewed and will be communicated through social media in due course.
Philippe Valahu, CEO of PIDG said: “The COVID-19 crisis has already had a devastating impact globally and both the immediate response and the recovery will require a huge amount of support and innovation, something that will be particularly pressing in some of the poorest countries in the world where PIDG operates. I am delighted that we are able to give support to the projects we invest in so they can carry out vital work locally.
Lasitha Perera, CEO of GuarantCo said: “We are proud that we are able to support our clients Kacific and Acorn, for which we provided partial credit guarantees towards the end of last year, to address the COVID-19 challenges that their local communities are currently facing. Considering the pressure on dollar financed transactions during the current situation, the local currency credit solutions which we provide will be more important than ever to support the economies in the lowest income countries in Africa and Asia in which we do our transactions with the aim to support the alleviation of poverty.”
Christian Patouraux, Founder and CEO of Kacific Broadband Satellites Group said: “Covid-19 has highlighted the importance of fast and responsive healthcare systems that serve everyone – from the country’s capital to the smallest village communities. Connectivity is fundamental to effective healthcare service delivery. GuarantCo’s grant will allow medical professionals to use software to order and distribute medicines and equipment, record and share patient information in national databases, and engage in counselling from specialists based in urban areas to arrange for emergency treatments. Importantly, GuarantCo’s grant will also help clinics at isolated and remote locations treat patients locally and save lives especially for emergency life-and-death case.”
Edward Kirathe, CEO of Acorn Holdings Limited said: “As the COVID-19 pandemic continues to affect many businesses globally, we are delighted for the support that GuarantCo and PIDG TA have offered us. This grant will allow us to continue operations at our construction sites, ensuring staff at each site have access to PPE and sanitising equipment. This keeps us in line with our aim of not only creating safe and secure workplaces for our staff and customers, but also creating jobs for our local communities which is extremely vital, now more than ever.”
GuarantCo mobilises private sector local currency investment for infrastructure projects and supports the development of financial markets in lower income countries across Africa and Asia. GuarantCo is part of the Private Infrastructure Development Group (PIDG) and is funded by the governments of the United Kingdom, Switzerland, Australia and Sweden, through PIDG, and the Netherlands, through FMO and PIDG. GuarantCo is rated AA- by Fitch and A1 by Moody’s. GuarantCo’s activities are managed by GuarantCo Management Company which is part of Cardano Development. www.guarantco.com
The Private Infrastructure Development Group (PIDG) is an innovative infrastructure development and governance organisation which encourages and mobilises private investment in pioneering infrastructure in the frontier markets of sub-Saharan Africa and south and south-east Asia to promote economic development and combat poverty. PIDG delivers its ambition in line with its values of opportunity, accountability, safety, integrity and impact. Since 2002, PIDG has supported 183 infrastructure projects to financial close and provided 243 million people with access to new or improved infrastructure. PIDG is funded by six governments (the UK, the Netherlands, Switzerland, Australia, Sweden, Germany) and the IFC. PIDG TA can provide technical assistance and capital grants to the PIDG companies to meet a range of needs associated with an infrastructure project’s life-cycle. PIDG TA can also provide up-front viability gap funding grants to support PIDG projects that require concessional funding to make a project with strong development impact financeable. www.pidg.org
About Kacific Broadband Satellites Group
Kacific Broadband Satellites Group is a satellite operator providing high-speed broadband for remote and rural markets. Kacific broadband fosters greater internet usage and fuels economic growth and improvements in service delivery across covered regions. Its high-power satellites use the latest multi-beam space communications and ground technology. Kacific’s first satellite, Kacific1, focuses on the Pacific and South East Asia. Kacific’s headquarters are in Singapore with operations out of Vanuatu. www.kacific.com
About Acorn Holdings Limited
Established in 2001, Acorn has over 19 years’ experience in East Africa’s real estate sector. Acorn is the largest provider of purpose-built student accommodation (PBSA) in East and Central Africa and provides 2,300 operating beds, with a further 5,000 in the pipelines. In 2019, with the support from GuarantCo, Acorn raised the first Green Housing Bond in Africa which was subsequently listed in the Nairobi Stock Exchange and London Stock Exchange. www.acornholdingsafrica.com
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