Uhuru Kenyatta’s assumption of the presidency has injected fresh energy into his family’s commercial empire, putting a number of its units on an expansion mode that is expected to consolidate its position as one of the largest business dynasties in Kenya.
The business empire that is associated with Kenya’s founding president Mzee Jomo Kenyatta has in recent months made fresh bets in the hospitality, dairy, media and banking sectors – and in foreign markets where it is seeking to buy existing players or launch green-shoe operations.
The investments come at a time when the second generation of the Kenyattas has taken full charge of the family business and the country’s politics, attracting attention with every single move.
Brookside Dairy, Heritage Hotels, Commercial Bank of Africa (CBA) and Mediamax Group top the list of Kenyatta business units on the charge – having either recently acquired rival firms, announced plans to expand or opened subsidiaries across the border. Brookside, a milk processor and one of the family’s flagship companies, is leading the new investments charge with mega acquisitions and expansion to areas it has to date not covered.
The dairy firm has just completed a Sh1.1 billion acquisition of rival Buzeki Dairy – the maker of the popular Molo Milk brand and topped it up with the establishment of a 1,500-litre capacity milk cooling plant in Narok.
Buzeki is Brookside’s latest takeover of a rival firm in a series that has seen it take control of Ilara, Delamere and SpinKnit (makers of Tuzo milk brand).
The acquisitions have pushed Brookside’s share of the processed milk market to 44 per cent, cementing its position as the Kenya’s largest dairy firm. Brookside has also cast its eye across the border into neighbouring Ethiopia where it is seeking to acquire a 20 per cent stake in a local milk processor, Elemtu Dairy.
If successful, this will be Brookside’s first investment outside Kenya and a learning point for its declared interest in entering Nigeria—Africa’s most populous country.
Commercial Bank of Africa (CBA), a mid-tier lender that is controlled by the Kenyatta family, has also recently been on the charge with the launch of an even more ambitious cross-border expansion plan that would see it establish a presence in 10 markets including Malawi, Botswana and Rwanda in the next decade.
CBA, which is Kenya’s largest non-listed lender with a total asset base of Sh100 billion, already has operations in Uganda and Tanzania.
The bank has grown to become the second largest in the retail market with its new mobile-banking product M-Shwari brand – developed jointly with Safaricom – and which has helped raise the number of the bank’s deposit accounts to more than five million from 34,884 in 2011.
The bank has shaken up its board and appointed President Kenyatta’s lawyer Desterio Oyatsi as chairman following the death of former chairman Mirabeau Da Gama Rose.
Mr Oyatsi took over from the President’s younger brother, Muhoho Kenyatta, who doubled as acting chairman and deputy chairman following the demise of Mr Da Gama Rose.
In recent months, the Kenyattas have also awakened their hospitality giant Heritage Hotels East Africa with the appointment of seasoned hotelier Mohammed Hersi as chief executive and the announcement of an expansion plan that aims at giving it a presence in the Kenyan capital Nairobi for the first time.
Until it tapped Mr Hersi from Sarova Hotels, Heritage has been without a substantive CEO in the past four years following the exit of David Stogdale and has been under the care of Muhoho.
Mr Hersi told the Business Daily in an earlier interview that he intends to pursue an expansion strategy that will see Heritage Hotels open a unit in Nairobi to tap the growing business travel market as well venture into other East African markets.
Heritage Hotels owns the Voyager Resort in Mombasa and Tsavo, Interpids camps in Samburu and Maasai Mara as well as the Great Rift Valley Lodge in Naivasha. Mara Explorer Camp and the Kipungani Explorer in Lamu Island are also part of the establishment.
Since the beginning of the year, the Kenyatta family has made significant investments in its media company, which is fighting to gain marketshare from established rivals.
It has invested millions of shillings in the technology upgrade and in top talent to staff K24 TV, Kameme FM and The People Daily.
The family is also said to be establishing a strong presence in the mining sector where billions of shillings are expected to be made in the next decade following recent discoveries of valuable deposits such as oil, niobium, coal, gold and titanium.
The latest surge in the Kenyatta empire is being seen as a sign of the First Family’s rising confidence in the national and regional economies.
It also helps that Uhuru is now president, providing the family with a strong shield against any risks arising from unfavourable and unpredictable government policies that send fear down the spines of many investors in Africa.
Recent and ongoing investments by the Kenyattas are the most conspicuous activities of an empire whose operations have been out of the public domain for the past three decades.
The full extent of the business dynasty, however, is still a closely guarded secret known only to the family, top lawyers and the elite investors with whom they do business. The Kenyattas have also been linked to Timsales Holdings, a timber firm, and Beta Healthcare, a pharmaceutical firm, among other companies.
Nigeria-based financial magazine, Ventures, has recently estimated the Kenyatta family fortune, including thousands of acres of land and commercial buildings to be worth $1 billion (Sh85 billion).
Kenyan companies have in the past five years setup operations in the East African market, seeking growth opportunities with ongoing removal of trade barriers under bilateral agreements and increased integration of the economies under the East African Community. Banks and insurance firms have led the outward expansion charge that has seen KCB, Equity, I&M Bank, and Britam establish subsidiaries in neighbouring countries.
Most of the Kenyan companies going regional say they have been attracted by the growth potential of the relatively underdeveloped economic sectors such as financial services, manufacturing and transport giving them competitive advantage in terms of capital and expertise.
The aggressive investments are expected to expand the Kenyattas’ stake in the Kenyan economy, distinguishing it as one of the country’s fastest growing business empires.
The fortunes of most of Kenya’s wealthiest families, including that of the Delameres, Pandits, and Chandarias, can be traced to the turn of the 20th century when the founders took to a mix of large-scale agriculture, real estate development, financial services and manufacturing.
Source- https://www.businessdailyafrica.com/
