HIRE AGREEMENTS

Panafrican negotiates plan to lease equipment to counties

The hiring structure is set to help kickstart projects that have been pinned out to financing.

In Summary

•According to Panafrican Equipment Kenya general manager Greg Jackson over four years, the market has been soft as the firm hope for projects for business growth.

•Panafrican has said they expect growth in the business with the free-floating of the borrowing rates.

Panafrican Equipment Group CEO Scott McMaw Executive Chairman, Charles Field-Marsham and the Group General Manager Greg Jackson after a presser at the newly launched Godown in Mombasa road on October 20 2019.
Panafrican Equipment Group CEO Scott McMaw Executive Chairman, Charles Field-Marsham and the Group General Manager Greg Jackson after a presser at the newly launched Godown in Mombasa road on October 20 2019.
Image: VICTOR IMBOTO

Equipment distributor, Panafrican Equipment Kenya Limited is negotiating for a plan that will allow the company lease equipment to county governments.

The plan under leasing program aims at increasing machine availability to tier two construction projects and small and medium-scale farmers in the agricultural sector.

According to Panafrican Equipment Kenya general manager Greg Jackson over four years, the market has been soft as the firm hope for projects for business growth.

The partnership that is also built between local leasing companies and banks was formulated to counter the impact of the cut on government spending and interest rate cap, however, likely to repealed.

 
 

The firm serves as the distributor for various equipment brands in all sectors including oil and gas, civil and construction, mining and mineral processing, agricultural, forestry, power and energy.

“It is a new approach engaging with the council of governors along the finance administrated. We are working with a number of deals and one in the process is with Laikipia County,” Jackson said.

Panafrican Equipment Group Executive Chairman, Charles Field-Marsham during a presser at the newly launched Godown in Mombasa road on October 20 2019.
Panafrican Equipment Group Executive Chairman, Charles Field-Marsham during a presser at the newly launched Godown in Mombasa road on October 20 2019.
Image: VICTOR IMBOTO

Panafrican chairman Charles Field-Marsham has said the hiring structure is set to help kickstart projects that have been pinned out to financing.

“If you look at the infrastructure requirements in the markets including dams, roads, rail, all are stages of potential launching with relative funding. The projects evolve with the funding then the contracts follow,” Marsham said. 

“With the delay of the funds, this sort of programs become quite important at the county level rather than waiting on the cycle of payment and non-payment,” he added.

During the three years into the implementation of the interest rate cap, the firm has been running on Panafrican Finance, funded structure for medium-sized clientele, which Jackson said has been selective, serving only single large mining contractors.

About $70 million has been issued through equipment purchase in the last four years.

 

It also expects to ride on the program between agricultural line Echo and Equity Bank to provide reasonable funds small scale farmers.

“We just have to make sure we are not caught out in the risks of government payment being slow in payment and try to mitigate where customers fall out of financial commitment,” he added.

Panafrican has said they expect growth in the business with the free-floating of the borrowing rates.

The Panafrican Equipment Firm.
The Panafrican Equipment Firm.
Image: VICTOR IMBOTO

The firm sees opportunities in the extractive industries as well as continued development in the power and energy markets.

“We still maintain growth prospects though mining has been  on small-scale relatively to other nations,” Marsham said. 

The firm, a subsidiary of the Panafrican Equipment Group (“PEG”) is the principal distributor of Komatsu, Wirtgen Group and AGCO machinery in Kenya.

Panafrican has operations in six nations in the continent; Tanzania, Uganda, Nigeria, Ghana and Sierra Leone, and selling operations in Burundi and Rwanda.