KK Security has acquired the operations of rival firm G4S in Rwanda as it continues to look for buyout opportunities to boost its foothold in the Eastern Africa market.
G4S has been operating in Rwanda since 2008 after it entered the market through the global purchase of Armor Group, which gave it a presence in countries where it didn’t have operations like Algeria, Rwanda and Sudan.
But the Rwandan business lost lustre after G4S lost its prize client—the American Embassy—to KK Security, prompting it to cede its Kigali operations to its rival.
Under the deal, whose value was not disclosed, G4S will cease operating the security business and transfer hundreds of guards to KK Security along with its remaining clients like the French embassy, Ericsson and SKOL.
Mr James Omwando, the CEO of KK Security confirmed the deal and said the two firms had been negotiating for the past four months.
“We have not bought the entire company, but took all their clients in Rwanda, and that has given us a big presence in the diplomatic segment,” said Mr Omwando in an interview with the Business Daily on Wednesday.
“We are looking at acquisition opportunities in the region as we consolidate our business. The intention is to grow our marketshare faster and avoiding going into unnecessary competition with firms that have carved their own niches.”
The exit of G4S will leave the Rwandese private security industry in the hands of KK Security and Intersec—which was formed by the government in the aftermath of the 1994 genocide.
KK security, which also holds the British Embassy contracts, opened shop in Rwanda in 1994 with its eye on the diplomatic and NGO security contacts—making Kigali its first subsidiary.
Last year, it won the US Embassy security contracts in Kenya and Rwanda—which prompted the exit of G4S since the latter was their main client.
Currently, KK Security also has operations in Tanzania, Uganda, and DR Congo, and is keen to boost its presence in these markets and cut reliance on the Kenyan market that is faced with cut-throat competition.
The firm has preferred acquisition to enter competitive markets, as underlined by its 2009 buyout of Knight Support that gave it a presence in the fire-fighting business, making it the second private company after G4S to enter the market.
In 2004, the firm bought EARS Group which has a foothold in the alarms and electronic security market.
Last year, it acquired Tanzania’s West Kili Pty Ltd in a buyout model similar to that of G4S where it buys the clientbase rather than the entire company.
West Kili had a heavy presence in Tanzania’s mining sector that KK Security was eyeing.