A few weeks ago Tullow Oil gave an update of their half year results with operational updates for different countries including Kenya and Uganda.
Uganda: Tullow sold a stake in its Uganda oil development to Total Oil for $900 million ($200m cash – $100m on completion, $50m at FID, $50m at first oil, $700m in deferred consideration), and will retain 10% of that and also of a $3.5 billion pipeline through Tanzania. The statement mentions inter-governmental agreements signed to secure pipeline routing and commence key commercial agreements, and last week, Tanzania and Uganda announced the commencement of the construction of a $3.55 billion, 1,445 kilometer-long oil pipeline that will be completed in three years.
Ghana has sustained low-cost production due to an absence of drilling in 2017.
Kenya: The Implementation experience of the early Tullow early oil pilot scheme will assist the Tullow oil joint venture, Kenya Government and Turkana county to prepare for full field development (however a previous plan to transport oil by truck had been shelved before the elections amid a dispute of sharing oil revenue).
Kuramo Capital, the largest shareholder of Transcentury is acquiring 25% of Sterling Capital stockbrokers, the second largest bond trader in the country
Diamond Trust to acquire Habib Bank Kenya for shares worth Kshs 1.82 billion (~$18 million). EDIT At the end of July, the Competition Authority approved the deal on condition that Diamond Trust retains at least 41 employees of Habib Bank post-transaction and the Central Bank communicated that the deal would be concluded on 1st August when Habib would cease to exist as a licensed bank.
The Competition Authority of Kenya has authorized the proposed acquisition of a minority stake of 10.68% of I&M Holdings by CDC Group PLC together with certain veto rights.
I&M Holdings also has announced the successful completion of a merger with Giro Commercial Bank
Carlyle to acquire Global Credit Rating Co. (South Africa)
Atlas Mara to acquire 13.4% equity in United Bank Nigeria, from Clermont Group for $55 million, increasing its stake to 44.5%
Sanlam Group has completed the acquisition of a majority stake in PineBridge Investments East Africa Limited. PIEAL is a leading asset management company in East Africa with operations in Kenya and Uganda – and the competition authority approved this at the end of July.
EDIT Alexander Forbes Kenya to change name & brand (to Zamara) after a change of shareholding to comply with new pension law that caps foreign ownership to a maximum of 40%.
Beauty & Pharma/Chem
The Competition Authority of Kenya authorized the acquisition of Dan Pharmacie by Mimosa Pharmacy.
The Competition Authority of Kenya authorized the acquisition of Sole Control of Syngenta AG (Syngenta) by China National Agrochemical Corporation (CNAC).
The Authority excludes the proposed acquisition of 72% of the issued share capital of Chemserve Cleaning Services Limited by Eye Level Exposure Limited from Part IV of the Act .. (their) combined turnover of KSh. 138,076,904 is below the required merger threshold for mandatory notification
Abraaj Group gets approval to acquire 75% of Healthlink Management (Nairobi Women’s hospital?)
The Competition Authority of Kenya has approved the proposed acquisition of 100% of the issued share capital of Monsanto Kenya by Bayer Aktiengesellschar/KWA Investment. Businessman Chris Kirubi revealed that he holds a 45% stake in agrochemical firm Bayer East Africa.
The Competition Authority of Kenya has authorized the proposed acquisition of the shares in the Dow Chemical Company by Dowdupont Inc. and the Competition Authority of Kenya has authorized the proposed acquisition of the shares in E. I. Du Pont De Numerous and Company by Dowdupont Inc.
A local drug store is set to be acquired for Sh. 2 billion. Imperial Health Sciences, which based along Mombasa Road will be acquired by South African investment firm Mara Delta Property Holdings. “The facility will be leased back to Imperial Health Sciences on a 10-year triple net basis, denominated in US$ and guaranteed by Imperial Holdings Limited.”
The Competition Authority of Kenya authorised the acquisition by Kibo Plastic Packaging of a minority (14.02%) shareholding with controlling interest in Blowpast Limited.
EDIT Japanese Kansai Plascon Africa has acquired local paint maker Sadolin for Kshs 10 billion.
Food & Beverage
Africa’s largest Coca-Cola bottler- Coca-Cola Beverages Africa Proprietary Limited (CCBA) has acquired Equator Bottlers, the third largest Coca-Cola bottler in Kenya. Equator Bottlers, was previously a subsidiary of Kretose Investments Limited owned by the Shah family, has been one of several authorized Coca-Cola Bottlers, which supply products in the Western regions of Kenya. It was established in 1966 and is based in Kisumu. EDIT At the end of July, the Competition Authority authorized the deal on condition that the merged entity retains at least 2,279 employees post-transaction and that Coca Cola file a compliance report in two years.
The Abraaj Group is to acquire 100% of Java House Group from Emerging Capital Partners – the story was first broken at Wallace Kantai’s blog and the deal is said to be worth about $130 million. Java House Group was established in Nairobi in 1999. In 2012, Emerging Capital Partners acquired a majority stake in the Company, with the founder retaining a minority stake. ECP has helped Java House grow from 13 shops in Nairobi into East Africa’s largest casual dining brand, building an ‘eat-out’ culture. Today, it has an unrivalled regional footprint of 60 stores across 10 cities in Kenya, Uganda and Rwanda.
Catalyst Principal Partners has, through a newly established firm, Britania Foods Limited, acquired the business and operations of Jambo Biscuits Ltd, being a leading biscuits manufacturer in Kenya with its flagship “Britania” brand.
The Competition Authority of Kenya authorized the acquisition of assets of Wanainchi Marine Products (Kenya) by One Holdings.
The Competition Authority of Kenya authorized the acquisition of Sosco Fishing Industries by One Holdings.
Distell, Africa’s leading producer of spirits, wines, ciders and ready-to-drinks (RTDs) continues to ramp up its investment on the African continent, with the acquisition of a further 26.43% in KWA Holding East Africa Limited (KWAL), Kenya’s foremost spirits manufacturer and distributor, from Centum Investment Company Limited. The African liquor giant now owns a majority shareholding of 52.43% in KWAL, having previously acquired a 26% stake from Industrial and Commercial Development Corporation (ICDC) in 2014.
Netherlands-based private equity firm DOB Equity announced that in which in December 2016 that it had acquired a stake in Kenya’s Countryside Dairy, a Nyahururu-based facility with a processing capacity of 100,000 litres of milk per day.
Amethis and Metier to acquire East African FMCG firm, Kenafric Industries.. Two private equity funds have bought a 40% minority stake in Kenafric Industries as the firm eyes regional growth…popular products under the confectionery and culinary segments include Fresh brand of chewing gum and Oyo food additive. It also manufactures snacks and ready-to-drink juices at its plant in Nairobi’s Baba Dogo. The business, started 30 years ago by Velji Punja Shah and his four sons, is looking to increase its coverage of other East African countries, saying it currently sells 45% of its products outside Kenya.
EDIT: The Competition Authority of Kenya has authorised the proposed acquisition of indirect control of Weetabix East Africa by Post Holdings through its wholly-owned subsidiary, Westminster Acquisition.
EDIT: Twiga Foods, the Kenyan business-to-business food supply platform announced today that it has successfully raised a Series A funding round including $6.3 million in equity and $4 million in debt instruments.
The round was led by Wamda Capital and includes Omidyar Network, DOB Equity, Uqalo, 1776, Blue Haven Initiative, Alpha Mundi, and AHL.
Today, Twiga is the largest distributor of several basic food staples in Kenya, having sold over 55 million bananas alone and delivering over 4,000 orders a week.
Additional to the Series A round closing, Twiga closed some $2 million in grant funding from USAID, GSMA, and others to support bolt-on farmer services, financial inclusion, and first of their kind domestic food safety initiatives.
Simba Corporation acquired a 35% minority stake in Hemingways Holdings and plans to grow from its current three properties: the Olare Mara and Villa Rosa managed by world leading hoteliers, Kempinski, and Acacia Premier Kisumu, as Hemingways is the parent company of three iconic properties that represent the definitive portfolio of luxury travel in Kenya: Hemingways Watamu, Ol Seki Hemingways Mara and Hemingways Nairobi. The transaction also includes Express Travel Group, a subsidiary of Hemingways that provides comprehensive and high quality travel management services through its international franchise partnerships with American Express Global Business Travel and Europcar International as well as through Hemingways Expeditions, a premium Destination Management Company. EDIT: The competition authority approved the deal at the end of July.
The Competition Authority of Kenya authorized the proposed acquisition of control of Abercrombie & Kent Kenya (Abercrombie) by Yan Zhao Global, from A&K Cayman L.P and other minority shareholders
Thomas Cook India acquired Kuoni Travel specialists in 17 countries (includes Private Safaris E.A. in Kenya)
Accor Hotels will relaunch Tune hotel under the ibis Styles brand.
Isuzu will become a 57.7% shareholder in Isuzu East Africa through the purchase of General Motors’ shareholding in the business. The other shareholders will remain as Kenya’s Industrial and Commercial Development Corporation (20%), Centum Investments (17.8%) and Itochu Corporation (4.5 %). EDIT: At the end of July, the Competition Authority of Kenya authorised the deal on condition that the merged entity absorbs all 383 GMEA employees, continues after-sales service of all the vehicle brands, Isuzu and Chevrolet sold and leased by GMEA for duration of all the after-sales service contracts, honours all existing dealership agreements between GMEA and its dealers, and communicates to all GMEA customers on the continuation of after-sales service.
The Competition Authority of Kenya authorized the proposed subscription for 24.99% shareholding in Trans-Century with 100% of the redeemable preference shares in TC Mauritius Holdings by Kuramo Africa Opportunity Kenyan Vehicle.
The Competition Authority of Kenya authorized the transfer of 50% of the issued shares in Safal Building Systems to Mabati Rolling Mills.
The Competition Authority of Kenya has authorized the proposed acquisition of 100% of Kenya Kazi by Gardaworld
Rift Valley Railways (RVR), the company that runs the century-old Kenya-Uganda railway, has moved to court in a last-minute effort to stop the concession manager, Kenya Railways Corporation (KRC), from terminating its 25-year contract.
The Competition Authority of Kenya has authorized the proposed acquisition of Reunert Limited of 75.39% of the ordinary shares in Metal Fabricators of Zambia PLC.
The Competition Authority of Kenya has authorized the proposed acquisition of 40.7% of the ordinary shares and control of ARM Cement Limited by CDC Africa Cement.
Crown Paints to buy back 15% of its stock, the first company to do this.. now allowed by Kenya’s new companies law.
EDIT Athi River Mining is selling its Mavuno Fertilizer subsidiary to Omya and Pinner Heights to focus on its cement business.
German-based solar electrification firm Mobisol has acquired pay-as-you-go off-grid (PAYG) solar industry software firm Lumeter.
Hass Petroleum sold a 40% stake to Oman Trading International to fund growth in Eastern Africa
Tullow Oil plc sold stakes in Uganda to Total Oil for $900M, and will retain 10% of that and of a $3.5 billion pipeline through Tanzania
Vitol Africa gets approval to acquire 19.91% of Vivo Energy from Shell Overseas Investments
The Competition Authority of Kenya has authorized the proposed acquisition of indirect control in Dalbit Petroleum by Humphrey Kariuki Ndegwa.
The Competition Authority of Kenya has authorized the proposed acquisition of the retail petroleum business of Hashi Energy by Lake Oil
The Competition Authority of Kenya has authorized the proposed acquisition of the retail petroleum business of Hashi Energy Limited by Lake Oil Limited
The Competition Authority of Kenya has authorized the proposed acquisition of 100% of Gulf African Petroleum Corporation by Total Outre-Mer S. A. on condition that Total Outre-Mer S. A. comply with the following hospitality and employment conditions— including All agreements remain in force with relation to the Mombasa Terminal; and the merging parties are limited in the termination of employees of Gulf African Petroleum.
PIC South Africa will take up all shares not taken up in the Kengen Kshs 4.4 billion on offer. The South African government employees pension giant with $133 billion of assets will take up 351.2 million new shares at Kshs 6.55 each (totaling Kshs 2.30 billion) as other shareholders get diluted by 5.33% each e.g. The Kenya Government which was a 74% shareholder before, will have 70% afterwards.
Real Estate & Supermarkets
The Competition Authority of Kenya authorized the proposed joint venture between Helios Investment Partners and certain shareholders of Acorn Group.
Cytonn Investments Management (Kenya) to acquire a $10 million stake in Superior Homes.
Konza Tech City is seeking investors to apply for land to build campuses, BPO’s, offices, hotels, and student housing etc.
China Wu Yi acquires Sh530m Kilifi land.
In April last year, Mara bought a 45.5% stake in Naivasha-based Buffalo Mall for Sh. 440 million. Mara has valued its investment in Buffalo Mall at $6 million (Sh. 603 million), implying a capital gain of Sh. 163 million in less than a year. The mall now brings in 2% of the multinational’s total revenues and represents 2% of its assets. The property is however yet to make a profit, with the six months ended December showing a pre-tax loss of Sh.2.8 million.
EDIT Uchumi expects to conclude a deal with an investor that is worth Kshs 3.5 billion of new shares.
The Competition Authority of Kenya has authorized the proposed acquisition of certain passive infrastructure of East Africa Towers by Kenya Towers.
Catalyst Principal Partners has acquired a significant minority interest in Kensta Group, a 52-year-old East African printing and packaging company Kensta Group manages a diverse set of companies within East Africa namely Transpaper (Kenya, Uganda, Tanzania, Rwanda), Express Automation (Kenya, Uganda, Tanzania, Rwanda), Vivid Printing Equipment, Fusion Inks, Zenith Rubber Rollers and Phiramid (Zambia).
Kenyan IT multinational Craft Silicon has acquired a Sh51.5 million minority stake in restaurants listing portal EatOut, marking its second major backing of a local tech company. Craft Silicon is a founder-shareholder of Little, which is also backed by local telco giant Safaricom. (via Business Daily)
Deal undone: Ghafla Kenya CEO Samuel Majani spoke about how a Ghafla merger with Ringier unraveled and on a lot of the intricacies of the issues such as exclusivity, assets & liabilities, dealing with partners & other shareholders, and on merging staff, customers & systems.
Deal undone: a Merger with JamboPay was unstuck after a court finding, and the founder of JamboPay, the firm that supplies Nairobi County’s e-payments platform, won a protracted battle against a rival firm over use of its trade name.
Mara Social Media acquired global Instant Messaging & communications platform “Nimbuzz” which has over 200 million users and is available for Android, iPhone, and Symbian, MIDP, Windows Phone, BlackBerry and PC & MAC clients
Film Studios has been acquired by MoSound
MTN is to acquire MultiChoice Africa – owners of @DSTV & GoTV
EDIT The Competition Authority authorised the proposed acquisition of fibre optic cable from Bandwith & Cloud Services Group by Safaricom.
EDIT Safaricom’s $1 million Safaricom Spark Venture Fund announced its sixth and final investment in agri-tech startup iProcure – which seeks to increase agricultural output in Kenya, which has remained comparatively low to other countries due to challenges including access to and use of quality inputs. Other invests include FarmDrive, Sendy, and mSurvey.
EDIT IFC invests Sh619m ($6 million) in mobile tech firm Africa’s Talking with the funds earmarked for the company’s expansion in Africa beyond the current seven markets where it has a presence.
The Competition Authority of Kenya has authorized the acquisition of Section Investment by Kisima Management.
The Competition Authority of Kenya has authorized the proposed acquisition of 43.8% of Kinetic Holdings by Catalyst Kinetic Investments.
Tullow Oil has an advert in the newspapers today seeking suppliers to help it transport oil from Lokichar, Turkana to Mombasa. There are two requests:
For registered truck companies in Kenya, that have new vehicles, and experience transporting hazardous material.
The other is for a lease of 100 pressurized insulated containers of 25,000 liters each. (Presumably these T11 standard containers can also be transported by railway).
There is a bit of regional and domestic politics here. While Uganda seems to have opted to refine its oil and ship it out via a pipeline in Tanzania, Kenya wants to show that it can deliver on that in the short-term.
Trucks on a highway (via AfricaKnows.com)
Also the Jubilee government is checking off all its pre-election promises and while the one to prioritise the construction of an oil pipeline from South Sudan and a new oil refinery at the coast may not materialize, expect by the August 2017 elections to have a barrel of Kenyan oil shipped out from Mombasa, regardless of the means of transport or the cost of production.
Once oil is trucked to the coast, the long-term picture could see a lowering of the costs and perhaps re-engagement by other countries in the region on the suitability of shipping oil through a pipeline in Kenya.
Comparing performance to last quarter and a year ago, the portfolio is down 10% in the last three months, while the while the NSE 20 share index is down 4% since August 2015, but down 23% since last November.
Bralirwa (Rwanda) ↓
Centum (ICDCI) ↓
CIC Insurance ↓
Diamond Trust ↓
Kenya Airways ↓
Kenya Oil ↓
Stanbic (Uganda) ↓
For the second quarter, in a row, everything is down, except the NSE share price itself, followed by Equity Bank which is marginally!
In: Barclays, Stanlib Fahari (I-Reit)
Out: Safaricom, Scangroup, Mumias
Increase: Equity Bank, NIC
Best performer: NSE (up 20%)
Worst performer: Atlas (down 73%) ,Bralirwa, Kenya Airways.
Unexpected Events: (1) Atlas bankruptcy, though the warning signs were there with the slowdown of exploration activities. It is mainly owed money by Tullow Oil and the Geothermal Development Company (GDC) (2) The collapse of Imperial Bank, which has had a knock on effect on other bank shares. (3) Kenya Airways half year results.
BritAmEA (i) Had an oversubscribed bond at the NSE that saw them raise Kshs 6 billion (ii) Completed the acquisition of 99% Real Insurance – giving them access to Mozambique, Malawi and Tanzania (the Competition Authority approved this deal with a caveat that they retain at least 85 of the 105 employees of Real) (iii) Established an office in Rwanda (IV) Britam will also pay about Kshs 2 billion for Equity’s 25% in Housing Finance.
Centum (i) Are proposing to acquire an additional 66% shares in K-Rep Bank (ii) Are seeking shareholder approval to create a Mauritius company, set up Kings Beverage, Bakki, Shefa subsidiaries, and also ratify the acquisition of 73% of Genesis & 30% of Broll (real estate) (iii) Ceded 42% of Two Rivers venture to investors at Kshs 6 billion, (iv) Are still in the running for Rea Vipingo offering Kshs 75 per share, over the Rea bid of Kshs 70 per share to other shareholders (v) Key Centum shareholder, Chris Kirubi said he wants to be a dollar billionaire.
Other recent deals include
Kenya Airways to give Tanzania’s Precision Air a $10 million bailout.
Waiting to see who will officially be FastJet’s partner will be for their renewed push to enter the Kenyan aviation market.
Hong Kong listed Frontier Services Group completed acquisition of 49%of Phoenix Aviation for $14 million (Kshs.1.2 billion).
Al Futtaim Auto to compulsorily acquire the remaining 8.4% of CMC shares from minority shareholders
Banking & Finance
Actis to acquire Compuscan, the largest independent credit bureau in Africa & run it as Credit Service Holdings with Michael Jordaan as chair.
Diamond Trust has an ongoing rights issue to raise Kshs 3.2B ($42 million) from shareholders at Kshs 165 per share.
Ecobank got investment bank approval in Kenya following their buyout of Iroko buyout and will target oil & gas, infrastructure & commodity deals.
KCB is now holding company, and is said to be interested in buying an insurance entity
(edit) Kenyan Women Holdings will sell 25% of the shareholding of Kenya Women’s Finance Trust to their 600,000 members between September and October 2014.
NIC Bank to have a corporate bond and rights issue during 2014
Atlas Mara to buy 77% of Development Bank of Rwanda
National Bank shareholders to vote on if money from their upcoming rights issue can go to pay off preference shareholders
Western Kenya politicians have support the creation of a new Mulembe Investment MFI bank, that will be part-funded by counties to serve 5 million people.
Building & Cement
Holcim is set to acquire effective control of Kenya’s Bamburi Cement as part of the planned merger between Holcim and Lafarge. “The parties do not wish to see any change to the status of Bamburi as one of Kenya’s leading industrial companies listed on the NSE.”
Food & Beverage
Danone bought 40%of Kenya’s dairy processing company Brookside which had revenue of Kshs15.4 billion (€130 million) i in 2013. It was previously 90% owned by the Kenyatta family with Abraaj owning 10%. Brookside collects milk from 140,000 farmers and has 3,000 employees.
Distell of Stellenbosch South Africa got privatization approval from the Kenya government to acquire of 26% of KWA Holdings E.A. that was previously owned by ICDC for Kshs 860 million (about $10 million)
Kenya Wines will also their Kshs126 millionUchumi Supermarket stake.
See Centum (above)
South African food company, Tiger Brands has dropped plans to acquire Kenya firms Rafiki Millers for $25m.
Health & Beauty
Procter & Gamble merged India, the Middle East and Africa into one IMEA region to improve execution
Hotels & Tourism
The Kenya Competition Authority approved the acquisition of 100% of Fairview Hotel by City Lodge Hotels.
Kempinski Hotels, Europe’s oldest luxury hotel group has officially taken over Hôtel Des Milles Collines in Rwanda.
See Britam above
CIC had dropped plans for a rights issue in favour of a corporate bond
Liberty Kenya proposed to pay a Kshs 1/= scrip dividend, but shareholders can opt for cash.
UAP had an oversubscribed bond that raised Kshs 3.1 billion against a target of 2B.
Africa Report magazine listed insurance companies as the top performers at the NSE in 2014 (see table).
Kenyan firms Hamilton Harrison & Matthews (HHM) and Oraro & Company have announced they are to merge pending regulatory approvals.
Media & Communications
The $35 billion Publicis-Omnicom merger fell apart. The deal to combine the world’s largest advertising company was foiled by myriad difficulties, including who would run the new firm. The collapse of the deal is a win for WPP CEO Martin Sorrell, who campaigned aggressively against the merger of two of his biggest rivals.
A few months after his big deal with One Africa Media consolidating operations in Kenya, Uganda and South Africa, co-founder, Carey Eaton, was killed in Nairobi. See some tributes to Carey Eaton. The Economist also ranked the largest internet companies in Africa and One Africa Media topped this at $80 million, followed by Mobile Planet ($15 million) and Kopo Kopo ($10 million)
passed away – some tributes
Scangroup agreed to acquire a majority stake in a pan-African firm – the Experiential Marketing Group (EXP)
The Safaricom and Airtel buy out of (and split of) Yu appears to have stalled.
Oil & Mining
In the last year, Tullow Oil and Base Resources have paid the Kenya government $22 million and $16 million respectively .
Tullow received a judgment in its favour over capital gains tax payments that Tullow had made onHeritage’s behalf to the Uganda Revenue Authority. In August 2013, Tullow received $345.8 million from Heritage in satisfaction of this High Court judgment.
Swala Oil & Gas completed their Tanzania IPO which was oversubscribed and will now proceed to list on the Dar es Salaam Stock Exchange (“DSE”). The placement of 13.3 million shares with 1,869 new and existing shareholders also allowed Swala to keep excess funds from Dar IPO.
Transportation & Utilities
Transcentury sold their 34% in Rift Valley Railways to Citadel Capital for $43.7M recovering their cash, but below fair value..they cited the delayed turnaround of the railway consortium as reason for the sale
Actis confirmed sale of its stake in Umeme for $85.5 million to 20 institutional investors including Investec and Uganda’s NSSF
Kone Kenya acquired the business of Marryat & Scott, an elevator installation company.
Other Peoples Money
The Australian Navy seized heroin worth $296 million from a wooden boat off the Kenyan coast.
The Karen Blixen house was put up for sale for $9.5 million
Kenya’s NSSF had $600 million (Kshs 51 billion) in quoted securities as at June 2013 topped by Bamburi EABL and KCB.
The Competition Authority fined Tusker Mattresses (Tuskys) and Ukwala supermarkets Kshs 5.3 million while allowing them to continue pursuing a supermarket consolidation deal.