By James Anyanzwa and Reuters

A London-based private equity fund Satya Capital has expressed interest in acquiring a stake in Nakumatt retail chain of supermarkets.

The chain is seeking to sell 30 per cent of its business to a strategic partner to raise Sh2 billion to enable it continue opening new branches.

The firm’s managing director Atul Shah has declined to reveal the identity of the new investor saying it would jeopardise on-going negotiations, which started last year.

But it understood that the retailer has been in talks with Satya Capital and Kingdom Holding Company, an investment group associated with the Saudi Arabia royal family.

However, Mr Shah said last week the deal to sell a stake in the chain to a private investor was close to completion.

The funds would be used to expand the supermarket chain in the east Africa, where 15 branches will be set up including more branches in Uganda and Rwanda and a branch in Tanzania.

The chain’s total branch count stands at 22, including Uganda and Rwanda outlets.

Satya Capital owned by Sudanese billionaire businessman Mo Ibrahim has revealed plans to invest $200 million in Africa this year.

Known for making a fortune from the mobile phone business and funding a major prize in support of leadership, Mr Ibrahim says the continent offered high returns on investments.

"I would not be investing in Africa if I’m not bullish about Africa," Ibrahim told Reuters on the sidelines of a Pan-African Media Conference in Nairobi.

He said the global financial crisis had bolstered Africa’s position as an investment destination.

"What was the risk in investing in the US? A lot of people lost their money investing in the US. Any investments have risks not only Africa," he said. "I believe Africa provides the highest rate of return on investment."

Acquiring a stake in Kenya’s largest retail chain by turnover, Nakumatt was among the investments Satya would make, Ibrahim added.

"Our people are talking to them and we made an offer to them. The ball is in their court because they need to restructure their organisation in a way that we can invest so we are waiting for them to do that," he said.

The tycoon, whose $5 million Ibrahim Prize has been awarded to former Mozambican President Joaquim Chissano and Festus Mogae of Botswana, said he was galvanising people around key issues confronting the continent.

"We are focusing everybody’s mind on regional economic integration in Africa, the issue of agriculture, the issue of climate change. We think these are the three issues Africa needs to focus on, all wrapped up in governance and good leadership," he said.

Last week, the chain stores acquired Woolmatt Supermarkets in Nairobi for Sh400 million with an aim of consolidating its presence in the Nairobi Central Business District.