Category Archives: Rwanda

ALU: Africa’s University of the Future

The African Leadership University (ALU) is a pan-African university, which aims to prepare students for jobs that don’t exist today. Their programs aim to equip students with necessary skills including entrepreneurship, leadership, critical thinking, and project management – right from their first term. They have an intense online engagement process to monitor student performance that starts right from the time students apply and then right through admissions, assignments, courses, exams and assignments.

Their current degrees on offer at their Mauritius campus are Computing (Bsc), Business Management (BA), Social Sciences (BA) and Psychology (Bsc). It opened in September 2015 and has over 200 students from over 30 African countries.  Every year, students can get up to 4  months of internship at one of the ALU partner organizations which include Cellulant, Coca-Cola, McKinsey, Tiger, IBM, PWC, Thomson Reuters,  Pernod Ricard and Swiss Re. The partners also help subsidize the cost of education at ALU where a year of tuition and accommodation is about $7,000 – a modest amount compared to the cost of university education in many countries.

They also have a study abroad program that takes 4-12 months and ALU will have an MBA program at a new campus that will soon open in Rwanda, and for which they are already accepting applications. ALU is part of the Africa Leadership Group, and has founders including Fred Swaniker, Graca Machel and Donald Kaberuka. Eventually, they plan to have  25 campuses across Africa that can host 10,000 students a year.

ALU teams are currently on road shows to promote the university in Accra, Nairobi, Johannesburg, and Lagos. They have workshops, schools visits, and other events this month as they promote the university, and they are accepting applications up to a deadline on June 5.

Shares Portfolio May 2015

Comparing performance to last quarter and a year ago.

snoop

Compared to last quarter, the portfolio is down 3% while the NSE 20 share index is down 10% since February 2015.

 

The Stable
Bralirwa (Rwanda)  ↓
Centum (ICDCI)  ↓
Diamond Trust  ↓
Equity –
KCB  ↓
Kenya Airways  ↓
Kenya Oil  ↓
Mumias  ↓
NSE ↑
Safaricom ↑
Scangroup ↓
Stanbic (Uganda) ↓
Unga ↑

Changes
In: Equity Bank
Out: None
Increase: Kenya Airways, Kenol, Mumias
Decrease: None
Best performer: Safaricom (up 11% this quarter)
Worst performer: Kenya Airways (down 34%) , Mumias  (down -33%)

Looking Forward To:
– Bank profits & dividends from banks (KCB) and Safaricom.
– More M&A deals from Centum after their bond

Other Events:

– Safaricom’s super profits continued, and defied expectations of many, with profits going up 38% to $336 million. The company is crucial to the Kenya government in that will pay almost $600 million in taxes & licences fees this year, plus a Kshs 9 billion ($100 million) dividend that works about to about 10% of the country’s tax revenue!

–  A Kenya Airways full year loss expected to be announced this month amid other restructuring, debt, bailout, partnership (is the KLM shareholding good or bad?) discussions. There was a comment from a KQ executive who said that “our profit on each passenger can’t buy a good cup of coffee”.

– Just across the border, in Rwanda, was the IPO of  Crystal Telecom, in which 20% of MTN Rwanda was sold to the public and will be listed on the Rwanda stock exchange. The IPO which closed last week, cost a minimum investment of $150, and was open to all East African citizens.

Guide to Bukavu

A guest post by @abbyqoey

Getting There: We did not take a direct flight to Bukavu. We flew with Kenya Airways to Kigali (Rwanda) then took a taxi to Rusizi the border town between Rwanda and DRC (South Kivu).

On Arrival: The Kigali International Airport is pretty fast and efficient. As an East African citizen, I did not have to pay any taxes or get visa to go through Rwanda. However, for non-East Africans you have to make a visa application online otherwise even the authorities from the point of origin (Nairobi) won’t let you fly to Rwanda (it happened to my Canadian colleague and he missed his flight from Nairobi to Kigali. They also do not allow visa payments at the airport – which differs from the information on their website)

The taxi ride takes about 5 hours one way, and it’s a scenic route through the forest on a really good road. The border crossing was not too hectic. It took about 10 minutes on the Rwandan side and about 15 minutes on the DRC side. People have to be wary of the moneychangers on the Rwandan side. The guy at the border office warned me that they sometimes give people fake currency and it’s safer to just stick to the legit bureaus.

Getting Around: We has a personal driver to take us round and this was mostly because we were working in a village that was about 1.5 hours out of Bukavu city. I did notice that locals took either small saloon cars or what appeared to be 14-seater vans to get round the city. These vehicles were mostly in a sorry state, but there were quite a number of taxis in a much better state. We took one once at night and it turned out okay. Out in the village we saw quite a few lorries transporting cargo and people, and we were told this is a popular form of public transport out there.

The locals speak French and Swahili. The Swahili dialect was quite different to what we speak in Kenya. Some people do speak English but they are few and so we had a local translator helping us for our time there. Our host client hired the driver and translator for us.

During the day we felt pretty secure walking around. We would sometimes walk around 7:00 pm to a restaurant near our hotel but we were a bit antsy doing it as we had been warned about doing so at a security briefing given by our host client. We also had to make sure we were out of the field by 3:00 pm so as to get to Bukavu by 5:00 pm. We noticed the streets emptied out really early in the night (compared to Nairobi).

Staying in Touch: We were able to use our personal mobile phones. We got new phones and local SIM cards too. We chose Tigo as our carrier, over other available carriers like Airtel, Orange and Vodacom. But sometimes we had problems making local and international calls via the network. Our friends and family also reported having problems while trying to call us from Nairobi. That said, the quality of calls when they worked was good.

We also had access to Wi-Fi at the hotel we stayed at, at some places we frequented for dinner and also at the office we sometimes worked out from.

Where to Stay: We paid $60 USD per night for B&B at the Horizon Hotel, which was for a simple standard room. The lights kept going off a lot of the times and most places in the city seemed to have generators.

We didn’t use any credit cards. We ‘d use both the USD and Congolese Franc. You can pay for something in USD and get the change back in Francs, dollars or both. On average I spent about $22 per day, usually on food.

Eating Out: There was a lot of plantain and different types of fish in the local hotel we frequented. There was also cassava, sweet potatoes, yams, rice, ugali, pork and a kind of eggplant stew. Lunch was always buffet style so I couldn’t really tell what was the staple dish. Also, mayonnaise was served with meals at almost all the hotels.

Beer is mostly in one-litre bottles and goes for around $5. A double tot of rum, whisky and other spirits is an upward of $10 and a red wine carafe was about $20.

Shopping & Sightseeing There is an area that has a lot of colorful Congolese fabric. My colleague got some for his aunt and friend.

Gorilla trekking is something I would recommend for those who are fit. This is because it entails about an hour’s drive out of the city and then walking through a hilly forest to get to where the gorillas chill J in the Kahuzi-Biega park area

You can also chose to take a ferry ride to Goma in North Kivu and go see some volcano. We heard it’s awesome but we couldn’t manage the logistics given the limited time we had. (You need to book for an excursion online, go across Lake Kivu to Goma, get a vehicle to get you to Mt. Nyiragongo which you then scale and then spend a night at the top – as it’s best to view the volcano at night).

Odd Points: The country uses two currencies, the US dollar and the Congolese Franc. The Franc notes were quite old, like really old and tattered. The Congolese would happily trade in these notes but if you gave someone a dollar with even the slightest of rips or dent they wouldn’t take it. They’d tell you stuff like, “This is not money here.”

Kenya Agri Exports to the EU take a Hit?

An ad in the September 22 Nation newspaper  has a statement by the European Union addressed to exporters from the East African Community on changes to the tariff regime starting on October 1 owing to the failure of the two sides to sign an Economic Partnership Agreement (EPA)

There was also an article in the same paper showing that a draft has been agreed to, and that a final EPA may be signed and effected in time, but others say it is too late for this.

The new rates, while still subsidized compared to what other nation suppliers pay to export to the EU, are still a blow considering that some exports will no longer be duty-free.

EU Agri

EU newspaper ad

While some like tea, coffee beans & carnations will remain duty-free, Kenyan exporters will pay subsidized rates  of 4.5% on tilapia exports (compared to a normal EU rate of 8%), 2.5% for roast coffee (not 7.5%), 10.9% for mixed vegetables (not 14.4%), and 5% for roses and cut flowers (not 8.5%) between November and May – which includes the crucial Valentine’s Day period when some flower farms can earn half their revenue.

This caps what has been a tough year for Kenya’s  exports of tourism, tea and coffee which have all been adversely affected, and now this.  The recently released Economic Survey 2014 showed total exports declined by 3% from Kshs 518 billion in 2012 to Kshs 502 billion in 2013 (as per the Devolution Cabinet Secretary).

Kenya will  qualify for the preferential (GSP) tariffs, while Rwanda, Burundi, Uganda and Tanzania are currently considered under “least developed countries” and most of their exports to the EU will qualify for a unilateral 0% tariff.

 

Kenyan M&A

Compared to one year ago

On-Going Deals

Auto’s: – This week Al-Futtaim held a press conference to reaffirm their commitment to African market that is being spearheaded by their takeover of CMC  in Kenya.  More than anything the event was meant to showcase that the group founded in 1930,  but which few in Kenya had heard of before the deal, is a serious legitimate company (unlike shadowy China Road & Bridge that has a $3.8  billion contract to construct a standard gauge railway in Kenya.)

They have several car franchises 65 years of Toyota in UAE, Volvo, Honda vehicle assembly parts & service, used car business  and is also in engineering, financials services and the retail mall development business in the Middle East  and Asia

Al Futtaim  are long-term investors will retain the CMC brand as it has a 65 year good history that will overcome the last two bad years . But they will de-list the company as they believe that being a private company will give them the flexibility to move faster and reclaim customers and brands that have been lost such as Land Rover. 

Interestingly, the opportinuity to buy CMC was presented to them by one of their banks who knew of their interest in Africa. The company then had to work very hard to meet and bring the feuding key shareholders on board to back the buyout.

EDIT Kenya’s competition authority has now approved the acquisition of 100% of CMC Holdings by Al Futtaim Auto

Scania East Africa Limited  have taken over the purchasing, importing, assembling, fitting out, selling, servicing  of trucks, buses and chassis in Kenya that was previously carried out by Kenya Grange Vehicle Industries.

Actis buys 36% of AutoXpress, East Africa’s leading tyre distributor, with 20 stores in Kenya and Rwanda.

Merali and Sameer complete buyout of 14.9% of Firestone’s stake in Sameer Africa.


Banking

CBA returns to Uganda after 47 years.

Fina Bank has changed over its operations in Kenya, Uganda and Rwanda to GTBank East Africa after Guaranty Trust Bank concluded the acquisition of a 70% stake in Fina Bank Group for $100 million through combination of a capital injection and acquisition of shares from Fina Bank shareholders.  

Pakistan’s MCB Bank to acquire Kenya’s Middle East Bank (via the Standard).

Kenya’s  competition authority  has approved the acquisition of 73.35% of Genesis Kenya by Centum Investments.

Letshego Holdings  of Botswana has acquired Micro Uganda, a year after acquiring Micro Africa Ltd of Rwanda.

Food &  Beverage

Art Caffe acquired Dormans increasing their outlets from 4 to to 11 and giving them a presence in more shopping malls like Yaya, Karen and City Mall in Mombasa where Dormans had shops. However the Art Caffe were rankled by a quite in a local newspaper referring to their customers as being upmarket compared to Dorman’s ones. 

EDIT: Kenya’s  competition authority  has now approved the acquisition of 7 coffee shops of Dormans by Art-Caffè.

Pearl Capital partners have invested $1.5 million in KK Fresh Produce. 

Kenya’s  competition authority  has approved  the acquisition of Rafiki Millers  by Tiger Brands.

Kenya’s  competition authority  has approved the acquisition of Magic Oven Limited by Tiger Brands.

Beauty: 

A Netherlands-based private equity fund, TBL Mirror Fund, has bought a minority stake in a high-end Nairobi salon chain that is seeking capital to expand across East Africa.

Advertising: 

Kenya’s  competition authority  has approved the acquisition of additional 16.48% shareholding in Scangroup Limited by Cavendish Square Holdings BV. 

Health: 

Kenya’s  competition authority has excluded the acquisition of 100% of Adcock Ingram Holdings Limited by CFR Inversiones SPA from the Act

Hotels: 

South Africa’s City Lodge acquires Kenya’s Fairview Hotel  after Fairview Hotel firm agreed to sell the outstanding 50% of the joint venture 

Insurance: 

Kenya’s  competition authority has approved the  acquisition of 66.38% of Phoenix of East Africa Assurance Company Limited by Mauritius Union Assurance

British American (BritAM) completes buyout of 99% of Real Insurance.

Oil

Kenya’s  competition authority  has excluded the acquisition of a 55% participating interest in Block 11A from ERHC Energy by CEPSA Kenya

Kenya’s  competition authority  has excluded the acquisition of a 55% interest in Block 2B in Kenya from Lion Petroleum by Premier Oil 

Transport 

Precision Air  of Tanzania seeks a bailout from Kenya Airways? 

Transcentury to reduce stake in Rift Valley Railways (RVR)?


Other
India  Exits

Ambani reports a Kshs 2 billion profit from Kenya real estate.. Ambani’s Reliance Industries in 2007 entered into a joint venture with Delta Corporation, which has developed high-end office blocks and a mid-to-low cost residential estate in Nairobi. Delta Corporation now says it plans to exit its real estate investments to venture into hospitality and gaming businesses. 

Essar to finalise sale of its Kshs 8.5 billion Yu stake in March ..the firm says it needs the Sh8.54 billion immediately and more cash in the short term to widen its footprint in Kenya and upgrade its network from 2G to 3G.

Essar also faces a Kshs 430 million hit in its Kenya oil refinery exit ..the government and Essar Energy Overseas are engaged in compensation talks following the Indian firm’s decision to exit the refinery.

New Deals

Agriculture: At Rea Vipingo, Bid Investments withdrew their offer and have signed up with Vania Investments who are offering a new Kshs 55 per share  bid – worth Kshs 3.3 billion ($39 million) –  for the company that will leave it listed at the NSE

 E-Biz: 

There’s a potential change in ownership, at MyStrawberryStore 

Kenya’s  competition authority  has excluded the  acquisition of 999 Ordinary shares 

of My Kenyan Network Limited by African Jobs as the two have a combined turnover of Kshs 12.6 million

Regulator Issues

Pepsi came to Kenya and took on Coke but have not made much impact. They are now saying that has Coke been unfair ..PepsiCo says that rival bottle has been curtailing its marketing campaigns geared at gaining a larger share of Kenya’s soda market in the complaint to the Competition Authority of Kenya (CAK).
 
Synovate directors risk jail, hefty fines..Competition watchdog asks Tobiko to prosecute Ipsos-Synovate’s chiefs for failure to seek regulatory approval of the firm’s acquisition of its predecessor Synovate.
 
In South Africa The Competition Commission plans to address anti-competitiveness between retailers despite concluding its exclusive lease agreements probe.
The investigation established that the respondents (3 supermarket chains)  were dominant in certain local markets and that they would often compel landlords not to deal with competitors (by entering into exclusive lease agreements with landlords in return for agreeing to ‘anchor’ the centre).

Jobs: Rwanda’s Agaciro Development Fund is seeking an investment office. Deadline is Feb 14.