KME Minerals Appoints CBE Capital to Arrange Ethiopia’s First Gold-Linked, Dollar-Denominated Preference Shares

By Capital251 Editorial Team | June 19, 2026

Ethiopia’s capital market has taken a landmark step into uncharted territory. KME Minerals (Ethiopia) Holding S.C. the Ethiopian holding company of London-listed KEFI Gold and Copper Plc has appointed CBE Capital Investment Bank as adviser for a proposed issuance of US dollar-denominated, Ethiopian Birr-settled, gold-linked preference shares targeted at selected Ethiopian financial institutions.

The mandate was announced at the inaugural Ethio-British Business Investment Forum, held in London the same high-profile gathering where KEFI also signed a landmark US$400 million mining services contract with BCM Group for the Tulu Kapi Gold Project, with Ethiopia’s Minister of Foreign Affairs, H.E. Gedion Timothewos Hessebon, in attendance.

If completed as proposed, the transaction would represent Ethiopia’s first US dollar-denominated, ETB-settled, gold-linked preference share issuance a genuinely novel instrument for the country’s still-young capital market.

What Are “Gold-Linked Preference Shares” and Why Does This Matter?

This instrument is more complex than a standard share or bond, and understanding it matters for Ethiopian investors and institutions watching the capital market develop.

A preference share is a hybrid security that sits between debt and equity holders typically receive a fixed return before ordinary shareholders and have priority on assets if the company is wound up, but do not hold voting control over the company.

What makes KME’s proposed instrument distinctive is its triple linkage: it is denominated in US dollars (protecting investors against Birr depreciation), settled in Ethiopian Birr (keeping it within Ethiopia’s legal and regulatory framework), and linked to the gold price (meaning returns are tied to the underlying value of the commodity the project produces).

For Ethiopian institutional investors banks, pension funds, and insurance companies operating in a Birr-denominated environment this structure offers a rare opportunity to gain exposure to gold price upside and dollar-denominated returns, within a regulated, locally settled framework.

CBE Capital CEO Zemedeneh Negatu acknowledged the historical significance of the transaction directly: “As a pioneering investment bank, we are pleased to arrange what would be Ethiopia’s first US dollar-denominated, ETB-settled and gold-linked preference share issuance.”

The Tulu Kapi Gold Project: What Is KME Raising Capital For?

The Tulu Kapi Gold Project, located in the Oromia region of western Ethiopia, is the centrepiece of KEFI’s Ethiopian operations and one of the most significant mining projects currently under development on the African continent.

The project has a probable ore reserve of 1.05 million ounces of gold and total mineral resources of 1.72 million ounces, putting it firmly in the mid-tier category rather than the speculative junior segment. Gold was first discovered and mined at Tulu Kapi on a small scale by an Italian consortium in the 1930s; KEFI formalised its partnership with the Ethiopian Government through a mining agreement ratified in April 2015.

The US$340 million project financing package was effectively completed in February 2026, when KEFI signed a US$20 million equity-ranking royalty with Chancery Royalty Limited as the final element of the package. Field teams and contractors were mobilised and a groundbreaking ceremony was held.

The KME preference share issuance is positioned as an optional, supplementary capital raise above and beyond the already-secured development budget. The funds raised would be in excess of development requirements and are earmarked for cost-overrun reserves, exploration, and non-obligatory but desirable high-impact social development projects to be designed with the authorities.

KEFI Executive Chairman Harry Anagnostaras-Adams framed it precisely: “The Tulu Kapi Gold Project is already funded and under development. This investment is intended to provide additional growth capital to accelerate opportunities beyond our current development plan while maintaining financial flexibility and preserving value for shareholders.”

The Ethio-British Investment Forum: A Stage Built for This Moment

The announcement emerged from the inaugural Ethio-British Business Investment Forum in London a gathering that produced an extraordinary concentration of high-level transactions and commitments around the Tulu Kapi project within a single event.

Harry Anagnostaras-Adams said: “Today’s Ethio-British Investment Forum marks an important milestone in the development of Ethiopia’s private sector and international investment profile. Mining has already emerged as Ethiopia’s leading export-generating sector, yet the industry is only beginning to unlock its vast potential.”

The $400 million BCM mining contract was signed in London during the inaugural Ethio-British Investment Forum and witnessed by Ethiopia’s Foreign Minister, underscoring both KEFI’s progress towards launching Tulu Kapi and Ethiopia’s push to expand its leading export-generating mining sector.

The CBE Capital mandate announcement at the same forum signals a deliberate strategy: using London’s international investor visibility to simultaneously advance the mine’s operational contracts and its Ethiopian capital market financing components, reaching both global and local audiences in a single moment.

CBE Capital: The Bank Behind the Deal

CBE Capital Investment Bank, which received its ECMA investment banking and brokerage license in March 2025, is a public-private partnership investment bank the first PPP of its kind in Ethiopia’s financial services sector. It is majority owned by the Commercial Bank of Ethiopia, the country’s largest financial institution and one of the thirty largest banks in Africa, alongside Dallol Capital, a private investment firm.

The appointment of CBE Capital for this transaction is strategically logical. As the investment banking arm of CBE Ethiopia’s largest financial institution with the broadest domestic network CBE Capital has unmatched access to the Ethiopian institutional investor community that KME needs to reach: commercial banks, insurance companies, and development finance institutions.

CBE Capital also has relevant regional transaction precedent. The bank has been actively shaping conversations about Ethiopia’s capital market, with Zemedeneh Negatu noting that without heavyweight institutions anchoring the market early, it could have remained deprived of the trading momentum needed to build investor confidence.

Orior Capital Hong Kong is co-advising KEFI on the transaction alongside CBE Capital bringing international structuring expertise to what is, by any measure, a novel financing instrument for the Ethiopian market.

“Ethiopianisation”: The Policy Context Behind the Instrument

The preference share issuance is not just a financing mechanism it is the practical expression of KEFI’s stated “Ethiopianisation” policy, a deliberate commitment to maximise Ethiopian stakeholder participation at every level of the project.

Selected Ethiopian investors have been invited to subscribe to KEFI Ethio Prefs, which are linked to both US dollars and the gold price. The KEFI Ethio Prefs will be offered through KME Minerals Ethiopia Holding Share Company, KEFI’s newly established Ethiopian holding company, and it is proposed that the KEFI Ethio Prefs be convertible into Ordinary Shares of KME Ethiopia upon its intended stock exchange listing in Ethiopia after production has commenced.

That last detail is particularly significant: the preference shares are designed to eventually convert into ESX-listed ordinary shares once the Ethiopian holding company lists. For institutional investors subscribing now, that provides a defined pathway from a private, gold-linked instrument to a publicly traded equity a structured exit mechanism that makes the instrument more attractive and more legible to institutional risk committees.

The Ethiopian Government already participates as an equity partner in Tulu Kapi Gold Mines Share Company, with a total holding of approximately 17% combining its pre-existing free-carried stake with newly issued shares. The preference share issuance extends this alignment of interests into Ethiopia’s private financial sector.

What This Means for Ethiopia’s Capital Market

This transaction matters well beyond KEFI and Tulu Kapi. It represents the capital market doing something it has not done before in Ethiopia: creating a new class of financial instrument suited to the country’s specific economic realities.

A gold-linked, dollar-denominated, Birr-settled preference share is precisely the kind of instrument Ethiopian institutional investors need protection against currency depreciation, exposure to hard commodity upside, local regulatory compliance, and a credible conversion path to listed equity. If this transaction closes successfully, it creates a template that other mining, energy, and infrastructure projects in Ethiopia could replicate.

It is an exciting time to launch Tulu Kapi, one of Africa’s highest-margin new gold mine developments. Already bank-backed, Tulu Kapi has been engineered both physically and financially to be robust for the long-term designed to pay all costs and service all debt at an all-in breakeven gold price of approximately $1,400 per ounce.

With the current gold price trading well above $3,000 per ounce, the margin environment for the project is highly favourable and the economics underlying the preference share instrument are correspondingly compelling for investors willing to engage with an early-stage issuance in a frontier market.

Timeline and Key Milestones

The issuance is subject to conditions, including the completion of road and electricity infrastructure at the Tulu Kapi site. The issuance of these shares is contingent on the completion of road and electricity infrastructure, anticipated by the end of 2026.

Separately, KEFI is targeting the commencement of pre-production mining at Tulu Kapi in mid-2027, with full production from 2028. The Ethiopian holding company’s eventual ESX listing would follow production commencement establishing the long-term equity destination for preference share holders.

Key Facts at a Glance

Instrument: US dollar-denominated, ETB-settled, gold-linked preference shares Issuer: KME Minerals (Ethiopia) Holding S.C. (wholly-owned subsidiary of KEFI Gold and Copper Plc, AIM: KEFI) Adviser: CBE Capital Investment Bank (arranger); Orior Capital Hong Kong (co-adviser) Target investors: Selected Ethiopian financial institutions Use of proceeds: Cost-overrun reserves, exploration activities, social development projects supplementary to the already-secured $340M development budget Project: Tulu Kapi Gold Project, Oromia Region, Ethiopia (1.05Moz probable gold reserves) Production target: First production 2027, full production 2028 ESX listing: Planned for KME Ethiopia post-production commencement Forum announced at: Inaugural Ethio-British Business Investment Forum, London

Sources

• Investegate / KEFI Official RNS — “KEFI Signs US$400m Tulu Kapi Mining Contract”, June 2026: investegate.co.uk
• Investegate / KEFI Official RNS — “Tulu Kapi Update”, February 11, 2026: investegate.co.uk
• Investegate / KEFI Official RNS — “Corporate Strategy Review and Update”, January 6, 2026: investegate.co.uk
• The Assay / Directors Talk — “KEFI Gold and Copper Releases Tulu Kapi Update Following US$20M Royalty Deal”, February 25, 2026: theassay.com
• Mining Weekly — “KEFI completes financing package for Tulu Kapi”, February 2026: miningweekly.com
• African Mining Market — “KEFI launches the high-grade/high-recovery Tulu Kapi Gold Project”, December 2025: africanminingmarket.com
• Infrastructure Now / Mining Technology — “KEFI awards $400m mining contract to BCM for Tulu Kapi project”, June 2026: infrastructure-now.co.uk
• Zemedeneh Negatu / X (Twitter) — CBE Capital Investment Banking License Announcement, March 2025: x.com
• Addis Fortune — “New Capital Market Pledges Power to the People But Finds Few Ready to Trade”, 2026: addisfortune.news
• KEFI Gold and Copper Plc — Official Website: kefi-metals.com

Capital251 is an independent Ethiopian capital market publication. This article is for informational purposes only and does not constitute investment advice. Verify all investment service providers at ecma.gov.et before investing.