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Virus halts Alios acquisition deal

NEWS
By Issack Awal Mohammed | April 2nd 2020

Doubts have emerged on whether a multi-million-shilling acquisition deal between Vehicle and Equipment Leasing Ltd (Vaell) and Alios Finance will go through.

The deal, which would have seen Vaell acquire a major stake in Alios’ Kenya, Tanzania, and Zambia operations, now hangs in the balance due to the uncertainty posed by the coronavirus pandemic that has thrown global markets into chaos. 

The transaction that started in 2019 was expected to end this year, but no end seems to be in sight with directors at both firms avoiding any definitive commitments.

“At the moment, everything is at a standstill since no physical meetings can be held. The directors from both sides are non-committal due to Covid-19 that has affected economies around the world severely,” said Vaell Managing Director for Kenya Bertha Mvati in a statement.

In the proposed deal, Vaell was to buy assets from the pan-African finance group, making it a major stakeholder in the three countries.

Alios operates in nine sub-Saharan countries, including Tunisia, Burkina Faso, Cameroon and Ivory Coast, as well as in the East African nations.

The firm lends to small and medium-sized companies working in transportation, manufacturing and services to acquire equipment through loans or hire purchase.

In the recent past, the firm has been looking for a strong partner as it looks to consolidate its East African operations. 

Ms Mvati said the biggest hurdle in the conclusion of the acquisition deal is the suspension of inbound flights to Kenya due to the coronavirus pandemic.

“There is no certain date for when the deal will be inked. Their managers are based in Tunisia and they have a team here in Nairobi, but the team cannot sign anything. The managers have to physically be here, and with this pandemic, we don’t know when they will come, but discussions are ongoing,” she said.

Doubts have emerged on whether a multi-million-shilling acquisition deal between Vehicle and Equipment Leasing Ltd (Vaell) and Alios Finance will go through.

The deal, which would have seen Vaell acquire a major stake in Alios’ Kenya, Tanzania and Zambia operations, now hangs in the balance due to the uncertainty posed by the coronavirus pandemic that has thrown global markets into chaos. 

The transaction that started in 2019 was expected to end this year, but no end seems to be in sight with directors at both firms avoiding any definitive commitments.

“At the moment, everything is at a standstill since no physical meetings can be held. The directors from both sides are non-committal due to Covid-19 that has affected economies around the world severely,” said Vaell Managing Director for Kenya Bertha Mvati in a statement.

In the proposed deal, Vaell was to buy assets from the pan-African finance group, making it a major stakeholder in the three countries.

Alios operates in nine sub-Saharan countries, including Tunisia, Burkina Faso, Cameroon and Ivory Coast, as well as in the East African nations.

The firm lends to small and medium-sized companies working in transportation, manufacturing and services to acquire equipment through loans or hire purchase.

In the recent past, the firm has been looking for a strong partner as it looks to consolidate its East African operations. 

Ms Mvati said the biggest hurdle in the conclusion of the acquisition deal is the suspension of inbound flights to Kenya due to the coronavirus pandemic.

“There is no certain date for when the deal will be inked. Their managers are based in Tunisia and they have a team here in Nairobi, but the team cannot sign anything. The managers have to physically be here, and with this pandemic, we don’t know when they will come, but discussions are ongoing,” she said.

Covid 19 Time Series

 

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