NABA member Voxtra is pleased to announce an investment in Western Seed Company. The investment of Kenyan Shillings 120 million (US$ 1.4 million) is structured as a quasi-equity debt instrument. Western Seed Company produces and markets hybrid seed maize to smallholder farmers. With an annual production of about 3,000 tons of seed, it is the largest independent seed company in Kenya. The company has been a pioneer in the Kenyan seed industry for more than 20 years, playing a leading role in promoting improved planting material among smallholder farmers in Kenya.
Maize is Kenya’s main staple crop. It makes up roughly a third of the national calorie intake, and is farmed by 90% of households in Kenya’s maize growing regions. While smallholder farmers retain the bulk of their maize crops for their own consumption, most farmers also rely on selling part of the harvest for cash. Due primarily to a combination of shifting weather patterns and a lack of affordable quality inputs, Kenya is no longer self-sufficient in maize.
The capital infusion from Voxtra will support the company’s efforts to more than double its seed production in five years. If successful, more than 100,000 additional hectares of farmland will be planted with improved seed and yield an additional production of more than 100,000 tons to smallholder farmers.
With this investment, Voxtra joins Western Seed’s current investors, Acumen Fund and Pearl Capital Partners (PCP). In parallel with Voxtra’s investment, PCP is investing an additional KES 30 million (US$ 350 thousand) through its African Seed Investment Fund.
Western Seed Company’s founder and CEO, Saleem Esmail, commented that “Building a leading seed company is a long-term endeavor. We have grown significantly over the past few years, and with Voxtra’s investment we can continue to grow comfortably. I am very pleased to have Voxtra join the team of patient capital investors to help us reach our ambitious goals.”
Voxtra’s Managing Director, Pål Dale, remarked: “We are pleased to join forces with Saleem Esmail and his team at Western Seed Company in bringing improved seeds to smallholder farmers. Access to quality seed is key to increasing agricultural productivity and combatting poverty and food insecurity in Kenya. We look forward to seeing Western Seed Company build on its strengths and grow its impact significantly over the coming years.”
The investment in Western Seed is the second investment of the Voxtra East Africa Agribusiness Fund.
The Voxtra East Africa Agribusiness Fund invests growth capital in capital-constrained agribusinesses that play pivotal roles in improving the livelihoods of smallholder farmers.
The Fund was established in November 2011, and has NOK 67 million (approximately US$ 12 million) under management. Among the shareholders are institutional investors such as Norfund, Grieg International and Kavlifondet, as well as Scandinavian high-net-worth individuals.