Kenyan business mogul buys back control of Haco from South Africa’s Tiger Brands
It is not yet clear how much Kirubi paid to regain total control of his company, which Tiger bought for about $3.6million for the 51 per cent stake.
It is not yet clear how much Kirubi paid to regain total control of his company, which Tiger bought for about $3.6million for the 51 per cent stake, but sources indicate Kirubi is paying a premium to regain 100% shareholding.
“I like my business. I’m taking back my business, that’s all,” Kirubi who declined to disclose the exact buyout price said adding that regulatory approvals are underway to enable closure of the deal.
The two parties fell out over one of Tiger’s strategic decision that would see an introduction of some of its items to the Kenyan market.
Tiger said it no longer supports Haco’s model of manufacturing and distributing various consumer goods under license, adding that it wants to focus on its own fast-moving consumer goods brands.
“In addition to products manufactured and marketed by Haco under its own brands, the majority of Haco’s business lies in the manufacture and distribution of products under licence, which is not aligned with our current operating model of owning leading FMCG brands,” Tiger said in a filing with the Johannesburg Stock Exchange (JSE)
Haco deals in products like Palmer’s Cocoa Butter, BIC ball pens, and washroom cleaner Jeyes Bloo all manufactured and sold under license by various multinationals the company has agreements with.
Tiger said its earnings and asset base will not be materially affected by the Haco divestiture, which is part of a plan to exit difficult markets. The company also sold its 51 per cent stake in Ethiopia’s East African Tiger Brands Industries.
The development comes barely two years after top executives of Haco Tiger Brands were accused of manipulating books of accounts in order to paint a rosy performance of the Kenyan unit.
Haco Tiger Brands was formed after the South African firm bought a 51 per cent stake in the then Haco Industries (K) Ltd owned fully by Mr Kirubi in 2008. It then invested over $500 million in Kenya, mostly expanding the capacity of the Nairobi-based factory.
Haco industries most valuable brands include BIG pens and shavers, Black silk and Miadi (hair care) and So Soft (Laundry.
The billionaire interest in publicly traded firms is currently concentrated in centum investments where he is the largest single shareholder.
It remains to be seen whether Tiger brands will re-enter the Kenyan market on its own or through a partnership with another company.
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