Karuturi Agro Products plc is prepared to float 200,000 shares at 1,000 birr each to local investors in Ethiopia, pending final approval from its board of directors. The shares will be the first lot sold by the company in Ethiopia. 
The shares are to be short term with guaranteed dividend payouts of 10% every year.
The company plans to offer shares that are more sophisticated than common stock and with the best options available in the absence of a stock market in Ethiopia explained Karuturi.
Karuturi will offer preferred shares at face value, allowing shareholders priority on dividends after all debt obligations have been met. Shareholders wishing to liquidate their shares can redeem up to 5% of the value of the total shares offered twice a year said Karuturi.The Karuturi board of directors made the decision to raise the company’s capital for almost 40 million US dollars to procure funds for increasing financial commitments.
The company requires 180 million US dollars to finance further land development in Ethiopia according to Karuturi. Most of the financing for the investment was acquired form a consortium of mostly Indian banks as well as banks from Ethiopia and Mauritius noted the company.
The company, however, still needs to secure an estimated 12 million dollars which it plans on doing by selling shares locally said Karuturi.
Raising funds within Ethiopia could also earn the company some trust locally by counteracting the image that Karuturi is solely owned by foreigners according to the company.
The plan to sell shares locally will need to receive final approval from the board of the company as well as the Ministry of Trade it was learned.
Source: Addis Fortune
