UK designer of iconic Dubai hotel buys Kenyan engineering company

A British engineering firm that designed the iconic Burj Al Arab hotel in Dubai has acquired a Kenyan company, making Nairobi its African headquarters for property, energy and infrastructure deals.

The London-based Atkins Thursday said it will build on the strong regional market presence of Howard Humphreys East Africa, an engineering services company, to grow its consultancy business lines including design, engineering and project management.

The entry of the London-Stock-Exchange listed company strengthens Nairobi’s profile as an investment hotbed that hosts regional offices for multinational giants like Honeywell, IBM, Google and Samsung.

“Nairobi is well connected and offers us a huge opportunity to scale up our business on the continent,” said Atkins chief executive for Middle East and Africa Simon Moon during the signing ceremony in Nairobi on Thursday.

He cited Kenya’s main airport, financial systems and market as key attractions for international investors.

The CEO said the company is eyeing government infrastructure projects like airport construction, energy plants, property, road transport systems and property.

He declined to disclose the value of the deal.

Howard’s managing director Kanwal Syan said the local company has a turnover of Sh1.2 billion ($12.5 million), meaning the buyout could be worth billions of shillings.

The Nairobi-based company has won consultancy jobs for energy projects like Olkaria geothermal plants in Naivasha, airports, roads and buildings like Times Towers, Britam Towers in Upper Hill, Garden City and Two Rivers in Nairobi.

Founded in 1931, the local firm also has a footprint in Tanzania.

Atkins seems to have smelled big money in the on-going and planned big-ticket public infrastructure projects as regional countries race to upgrade their energy, roads, and airport infrastructure.  

Mr Moon said the company recently designed a national transport master plan for Malawi.

Multinationals foraying into the domestic market have in recent years opted for acquisitions or joint venture agreements with local firms since it spares them regulatory, market research and logistics hassles.

Last year, Johannesburg-based Barclays Africa acquired Kenya’s First Assurance, an insurer, for Sh2.9 billion while UK-based Old Mutual bought a controlling stake in UAP Holdings and Faulu Kenya a year earlier.

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French beauty and cosmetics giant L’Oreal three years ago acquired Nice & Lovely range of products from InterConsumer, a local startup, in a deal estimated to have been worth more than Sh1.5 billion.

L’Oreal made the buyout, targeting Kenya’s fast-growing lower end of the market, where it had no presence.

Atkins, which is one of the consultants picked for the upgrade of London’s Heathrow Airport, has an annual turnover of $2 billion (Sh203 billion).

It also designed Dubai’s metro transport system, highlighting the prowess of the company that plans to expand its workforce locally from the current 200 and transfer new technical skills.

“We will initially continue operating under Howard Humphreys but will later on change to Atkins, which is globally recognised,” said Mr Moon.

Kenya has been keen to attract foreign direct investments in the economy for jobs creation, capital inflows and crucial skills transfer for growth.

Government officials have been dangling a carrot to investors, promising low power costs and reduced bureaucratic red tapes.

High operational costs have in the past forced some manufacturers out of the domestic market, putting policymakers under pressure to restore investor confidence in the country.