Chai Sacco plans to raise Sh500 million in new share float

Kenya: Chai Savings and Cooperative Society (Sacco) is set to float shares to its members with a view of raising Sh500 million to finance an ambitious growth plan.

The Sacco, which was registered in 1973 to offer financial services to the Kenya Tea Development Agency (KTDA) workers has embarked on a five-year (2014-2018) strategic plan with hopes of improving its visibility and becoming a force to reckon with in the cooperative sector.

Chief Executive Purity Maina said the share offer to be priced at Sh20 a piece will be sold only to the existing and new members. “For one to be eligible to buy these shares he/she must be a member of our Sacco,” she said. The proceeds from the Share capital mobilisation programe, she said, would be channeled towards opening new outlets and marketing offices in strategic locations mainly tea growing zones.

As part of the plan the Sacco is seeking to grow its membership from the current 9,000 members to 40,000 by 2018 by opening up the institution to savings from organised groups and the general public.

“Apart from the KTDA workers we came up with a policy shift and started bringing on board organised groups which were willing to allow their workers to save with us through a check-off system. However we are now not just targeting the organised groups but we are also opening up to the general public because things have changed in the Sacco movement. Saccos are now regulated and the general public now has confidence in the Saccos,” Maina said in an interview.

“We are working to get people to trust us and to trust our institution so that they can give us money.” As part of the strategic plan, Chai Sacco expects to grow its total assets from Sh1.5 billion to Sh6 billion, to increase its branches from three to nine and to open up 25 marketing offices.