Norfund to support Hela Apparel’s East African operations
View(s):Norfund, the Norwegian government’s investment fund, with a mission to support sustainably driven business operations in developing countries, recently signed a US$14 million financing agreement with Hela Apparel Holdings PLC to bolster the development of its manufacturing operations in East Africa. NDB Investment Bank Ltd acted as the Financial Advisor for the transaction.
The official announcement was made in the presence of Gunnar Andreas Holm – Norwegian Ambassador to Kenya, Tellef Thorleifsson – CEO of Norfund, William Nyaoke – Norfund’s Regional Director for East Africa, Nishantha Mohottige – Country Director for Hela Kenya and Rukshan Aponso – Vice President of Corporate Advisory for NDB Investment Bank Ltd, at an event held at Hela’s manufacturing facility in Kenya recently, the Sri Lankan company said in a media release
Hela Kenya, established in 2016, is the largest manufacturing facility within the Hela Group and employs over 4,000 people. The facility is also one of the largest of its kind in Kenya, and currently produces approximately 20 per cent of the country’s total apparel exports. Hela was the first major Sri Lankan apparel manufacturer to establish operations in Kenya and has played a leading role in the rapid growth of the industry across the continent over recent years, with the subsequent establishment of manufacturing locations in Ethiopia and Egypt.
“Our expansion to Africa has been a rewarding venture, and we continue to see many opportunities within the region for further development,” said A.R Rasiah, Chairman of Hela Apparel Holdings. “Given the increasingly unpredictable global environment, establishing long-term financing relationships with strategic partners who share our vision for Africa as a global apparel sourcing hub plays a critical role in ensuring the envisioned plans for growth are realised. Hela’s African operations provide livelihoods to thousands of people, and our continued growth as a manufacturer will help us continue to strengthen and empower many communities across the globe.”
The proceeds from Norfund’s investment will also be utilised to strengthen Hela’s strategic supply chain partnerships in East Africa. This will enable Hela to leverage regional sourcing from Kenya and Tanzania to a larger extent, providing significant cost and lead time advantages for manufacturing in the region. A potential supply chain investment is also being considered by Hela for the proceeds.
“We have been impressed with what Hela has already delivered through its investments in East Africa and are confident that this partnership will go a long way in helping Hela create more employment opportunities primarily for low-skilled women and those vulnerable in society who struggle to find such opportunities,” said William Nyaoke, Norfund’s Regional Director for East Africa.
With 10 manufacturing facilities across four countries and a workforce
of 20,000 across the globe, Hela says it leads the industry in ethical and sustainable working environments.
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