Centum Investment Company PLC has agreed to sell its shares in Almasi Beverages Limited (“ABL”) and Nairobi Bottlers Limited (“NBL”) respectively to Coca-Cola Sabco East Africa Limited, a subsidiary of Coca-Cola Beverages Africa.
The investment company plans to sell its stakes in the two drink firms with a total valuation of 19.5 billion shillings ($192.5 million), as at 31 March 2019, it held its investment in ABL and NBL at a total value of KES 16.8 billion.
Centum holds 53.9% of the issued shares of ABL and 27.6% of the issued shares of NBL, the deal with Coca Cola Africa is expected to close in the next four months.
During its investment period of 2014 to 2019, Centum notes that the two assets achieved gross IRR of 27.15% and 38.97% for ABL and NBL respectively.
“Over the last four years, we have invested in new lines, operational efficiency and distribution channel optimization that has seen EBITDA grow four times,” part of the statement issued by the company noted.
Centum further said that the proceeds from these transactions would be applied towards repaying its current U.S. dollar-denominated bank term loans of 7.5 billion shillings which will result in savings of Kshs 700 million in finance cost.
“The balance of the proceeds will be invested in our private Equity and Marketable Securities portfolios,” the investment firm adds.
The completion of the acquisition by CCBA of the majority stake in ABL from Centum awaits regulatory approvals from the Competition Authority of Kenya.
The company thus cautioned its shareholders and the investing public to exercise caution when dealing in the shares of Centum while the sale transactions are ongoing.
At the same time, the company announced that it recorded a 41% rise in full-year pretax profit, profit for the year to the end of March rose to 4.44 billion shillings from 3.15 billion the year before.