Two private equity funds have bought a minority stake in Kenafric Industries as the firm eyes regional growth.
Paris-headquartered Amethis Finance and South Africa’s Metier are buying a 40 per cent stake in the confectionery and culinary segments of the local manufacturing business.
The two firms are expected to steer the firm in its quest to grow its footprints across Africa, starting with East Africa.
“This transaction is limited to the confectionery and culinary business and the Shah family (founders of Kenafric) will continue to operate the footwear and stationery business separately,” said Kenafric Industries in a statement Tuesday.
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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 per cent of its products outside Kenya. “Kenafric has reached a critical size and now intends to expand into a regional packaged food platform,” the company said.
It is the first time the family is bringing on board external partners and the two private equity funds are expected to structure the firm as it commences its next growth phase.
“Through this investment, we will seek to leverage the deep relationships that they (Metier and Amethis) enjoy in the region, operational support and a strong capital base to accelerate future growth,” said Kenafric Chairman Bharat Shah.
Jean-Sebastien Bergasse, the Amethis Partner in charge of the project, said the move would enable “Kenafric to leverage on its strong existing base to expand into a diversified packaged food platform in East Africa”.