RVR row headed for arbitration in London

“We are always looking for an additional stake, even now. If any of the shareholders want to drop out we are more than happy to cover them,” he added.

The other shareholders of RVR are local listed investment firm Centum Ltd with a 10 per cent holding, Tanzania’s Mirambo Holdings (15 per cent), Prime Fuels of Kenya (15 per cent) and Babcock Investments Holdings of Australia (10 per cent).

TransCentury say that most of these shareholders will be willing to sell their shares with Cidatel emerging the likely buyers.

Transcentury reckons that the move by the Egyptian is part of a plan to acquire 100 per cent shareholding in RVR.

“The Egyptians want to buy all of Sheltam and inject the money and stop the other share holders from participating,” said Mr Ngugi Kiuna, TransCentury’s representative on RVR’s board in an earlier interview.

The battle between the PEs is informed by forecast outsized returns from the railway in an East African market that is expected to rev up the movement of bulk cargo across the region.

But most importantly the fund owners are keen on a firm hold of the region’s logistic corridor to support their planned investments in the region from Uganda to Southern Sudan and Kenya.

The local PE firm with the support of Helios Capital is keen to offer $50 million (Sh3.7 billion) of investment capital to RVR but on condition that it assumes the lead shareholder role.

Fresh financing

Citadel Capital has committed $ 150 million (Sh11.2 billion) over the next five years to RVR.

Three years since the granting of the concession, RVR’s performance has failed to live up to the expectation of both Kenya and Uganda governments on what is attributed to the lack of financial and technical muscle on the side of the lead investor—Mr Roy Puffet of Sheltam.

It has also been unable to access fresh financing from lenders unable to access fresh financing from lenders due to the endless boardroom and shareholder wars.

RVR requires about Sh15 billion over the next five years to revamp its fleet and repair the deteriorating rail network.