HF Group Plc Rights Issue Oversubscribed by 38.32%

Listed financial solutions provider HF Group Plc (NSE: HFCK) has announced the successful conclusion of its Rights Issue, achieving a total subscription performance rate of 138.32%, representing an oversubscription of 38.32%.

Robert Kibaara, the Group’s CEO, expressed his excitement about the outcome:

“The outcome of the Rights Issue has been an overwhelming success. We approached our shareholders seeking an additional investment of Kes 4.6 billion, and by the conclusion of the process, we had received applications amounting to Kes 6.38 billion. We are now firmly on the path to powering our next phase of business growth.”

This significant capital raise marks a key milestone in HF Group’s five-year strategy to evolve into a full-service banking institution and a fully diversified financial entity. The raised capital will empower the Group to expand its product offerings, enhance its technology platforms, and position itself for sustained growth. Notably, HF Group is now in its third consecutive year of profitability.

Details of the Rights Issue

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

To accommodate potential oversubscriptions, the Rights Issue also included a green shoe option of up to 30%, equivalent to 384,614,168 shares. By the end of the process, the total number of new shares applied for—including entitlement and additional shares—was 1,595,995,966, representing a total gross value of Kes 6,383,983,864.

Shareholder Confidence

HF Group Chairperson, Prof. Olive Mugenda, acknowledged the strong confidence displayed by shareholders:

“This is a great show of confidence by our shareholders. Our key shareholders, including Britam and NSSF, as well as our retail shareholders, demonstrated immense trust in the Group by fully taking up their rights. We have now laid a solid foundation for growth and look forward to unlocking value for our shareholders in the short term.”

Robert Kibaara further elaborated on the allocation of funds:

“These funds will primarily go towards expanding our business operations, with 85% allocated for growth initiatives and 15% dedicated to technology and digitization to improve efficiency and enhance customer experience.”

Aligning with Capital Regulations

This successful capital injection positions HF Group on course to fully comply with the new capital regulations, which require banks to grow their capital base to Kes 10 billion by 2028.

Trading Timeline

The new shares will be credited to shareholders’ CDS accounts on Monday, 23rd December 2024, with trading set to commence on the Nairobi Securities Exchange (NSE) on Tuesday, 24th December 2024.

Key Improvements:

1. Grammar and Punctuation: Adjusted for clarity (e.g., “over subscription” → “oversubscription” and “Kes 4.6Billion” → “Kes 4.6 billion”).
2. Structure: Organized into clear sections with headings for better readability.
3. Flow: Smoothed transitions and improved phrasing for a more professional tone (e.g., “structured to offer shareholders two (2) new ordinary shares…”).
4. Professionalism: Enhanced the overall tone to align with corporate reporting standards.

Let me know if you’d like further refinements!

O

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