Kenya’s Sun King completes $156 M securitization to expand off-grid solar

In order to expand accessible solar throughout the nation, Kenyan off-grid solar energy company Sun King has closed a historic US$156 million securitization.

With innovative product design, reasonable financing, and a grassroots installation model, Sun King, the world’s top off-grid solar energy company, was founded in 2007 to supply energy to the 1.8 billion people in Asia and Africa without access to dependable electricity.

With Sun King’s pay-as-you-go solar model, households can purchase solar products by using mobile money to make small, flexible payments as little as US$0.19 (KES 25) per day. Nearly 10 million individual customers throughout Africa have received $1.3 billion in solar loans from Sun King to date.

In a local currency transaction, the company closed a US$156 million securitization deal that will help an estimated 1.4 million low-income households and businesses get electricity, frequently for the first time, and move away from expensive, dirty fuels like diesel and kerosene.

This is the second-largest securitization that Sun King has made in Kenyan shillings. Outside of South Africa, the transaction represents the biggest securitization ever finished in Sub-Saharan Africa. Five domestic and foreign commercial banks, as well as three development finance organizations, support the securitization, which was organized and structured by Citi with Stanbic Bank Kenya Ltd. (a member of the Standard Bank Group) serving as the placement agent. It expands on the US$130 million securitization of the company in 2023.

Through the securitization process, Sun King is able to raise long-term local currency debt by turning future solar product repayments from customers into investable assets.

“Millions of off-grid households have switched to solar thanks to small ‘pay-as-you-go’ loans.  This deal signals a major turning point for green energy finance in Africa,” said Anish Thakkar, co-founder of Sun King. “It shows that African commercial banks believe in the power of pay-as-you-go solar and are ready to back it with serious capital. Return-seeking, local capital in local currency is essential to unlocking the scale and speed needed to achieve universal energy access.”