Hela Investment Holding (HIH), a clothing manufacturing firm operating in Kenya’s export processing zone (EPZ), has secured a Ksh 5.38billion (USD 40 million) investment deal from International Finance Corporation (IFC) to finance its operations. The IFC will finance HIH through a Ksh 2.69 bn (USD 20 million) loan as part of the deal.
HIH plans to use the loan to finance the long-term working capital requirement of the Hela Group and support the growth of its manufacturing operations in Kenya, Egypt, and Sri Lanka.
The IFC funding comes after Norfund signed a Ksh 1.88 bn (USD 14) million financing agreement with Hela Apparel Holdings PLC to boost its manufacturing operations in East Africa. The Hela Group operates six manufacturing facilities in Sri Lanka, and its facility located in the Mawathagama EPZ will be the primary beneficiary of the IFC loan.
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The Hela Group’s Kenyan manufacturing facility is located within the EPZ in Athi-River, and it employs over 4,000 people. Most EPZ firms in Kenya are in textiles and apparel and export to the US under the quota- and duty-free Growth and Opportunity Act.
EPZ firms are granted perpetual exemption from payment of stamp duty on legal instruments as well as payment of value-added tax and customs import duty on inputs. Kenya had 153 EPZ firms by June 2022, up from 144 the previous year.
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