TransCentury sells stake in Rift Valley Railways

TransCentury Ltd,  a  regional infrastructure company has exited RVR after it sold its shareholding in the firm to Africa Railways, a subsidiary of Citadel Capital of Egypt. [PHOTO: FILE/STANDARD]

By JACKSON OKOTH

NAIROBI, KENYA: The Nairobi Securities Exchange (NSE) listed firm, TransCentury Limited has finally sold out its entire stake in the Kenya–Uganda rail concessionaire Rift Valley Railways (RVR) to Africa Railways — a subsidiary of Citadel Capital of Egypt. The transaction, whose value has not been disclosed, was executed yesterday, bringing Citadel’s total ownership of RVR to 85 per cent, up from 51 per cent.

TransCentury first invested in RVR in December 2006, acquiring a 20 per cent stake in the company and later increased its shareholding to 34 per cent in May 2010.

According to TransCentury Chief Executive Officer, Gachao Kiuna, the firm’s board made the sale decision to maximise shareholder value, but still remains very positive about the fundamentals of RVR despite the historic challenges the business has faced.

“We are actively exploring other possible ways to work together with our colleagues at Citadel Capital to support RVR and maximise value for all stakeholders,” he said in a statement.

Zephaniah Mbugua, the chairperson of TransCentury said the firm has been part of the RVR story for the past seven years and helped steer it through some very challenging times.

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“RVR is vital to the economies of Kenya and Uganda and TransCentury remains fully in support of the company,” he said.

Mr Mbugua wished Citadel Capital and the team at RVR all the best as they continue to see through the turnaround of the railway.

REGIONAL INTEGRATION

Chairman and Founder of Citadel Capital, Ahmed Heikal said the investment company believes the citizens and business communities of Kenya and Uganda have a right to a world-class railway that serves as an engine of national development and regional integration.

“We are honoured to continue working with our partners in Africa Railways on RVR’s turnaround story,” he said in the joint statement.

Citadel Capital first acquired a minority stake in RVR in 2010, eventually becoming lead shareholder. Both Citadel and TransCentury have pumped in new cash into RVR to replace hundreds of kilometres of old track.

They have completed rehabiliting part of the 500 kilometres of rail linking Kenya with Tororo in Eastern Uganda and Gulu in the north.