US war contractor lines up 25 planes for Kilifi airstrip

Former US Navy Seal Erik Prince aims to have 25 aircraft delivered to a Kilifi airstrip by end of this year to provide specialised aviation services, including aerial survey of installations such as oil pipelines.

The controversial former private security contractor for the US army is executive chairman for DVN Holdings, a Hong Kong Exchange-listed firm which has acquired a 49 per cent stake in Kilifi-based Kijipwa Aviation to act as a base for his transport and logistics business.

DVN Holdings chief executive Gregg Smith told the Business Daily that the company has a $85 million (Sh7.3 billion) cash outlay to aggressively grow its African aviation services business, which will be run from Nairobi.

“We plan to have about 25 aircraft based in Kenya within the next six to eight months,” said Mr Smith in a telephone interview shortly after a visit to Nairobi.

He added that the aircraft could in future include unmanned aerial vehicles, commonly called drones.

Mr Prince is the founder of Blackwater — the controversial US defence contractor that at one time came under fierce criticism over its operations in Iraq.

READ: Turkana oil find attracts US private security baron

Blackwater employees were accused of human rights abuses and killing of civilians during the Iraq war. The company was also investigated by the US congress over allegations of over-charging the American government for its private security services.

The DVN Holdings chief executive, who says he has worked closely with Mr Prince for about 15 years, disclosed that the firm would specifically target Chinese companies doing major infrastructure and mining deals in Africa.

The company will also undertake reconnaissance surveillance flights for NGOs, governments and organisations working in remote areas.

“We have had discussions with several Chinese State-owned-enterprises in Beijing, they like the fact that we have surveillance capabilities,” said Mr Smith.

The ex-US marine sold his aviation and logistics firm Frontier Services Group in November last year to DVN Holdings.

The transaction valued his stake at Kijipwa at Sh1.9 billion and was paid for in a cash and share swap deal that saw Mr Prince hold a 15.3 per cent stake in DVN Holdings and earned him board chairmanship.

The former army officer received Sh258 million ($3 million) in cash and a further 205.12 million shares at a price of HK$0.73 a piece, according to regulatory filings at the Hong Kong bourse.

DVN Holdings plans to acquire a controlling stake in Kijipwa to use the Kilifi base to offer logistics, aviation and risk management services to multinationals operating in eastern Africa’s natural resources sector.

The DVN Holdings chief executive said that Mr Prince’s controversial past would not jeopardise his business in Kenya. He said his past “should give customers comfort” that a businessman who has navigated difficult operating environments is handling their business.

The company also intends to operate Barges in the Nile to move customers’ goods and equipment.

A recent report by US-based research firm Casey says East Africa is expected to be one of the world’s most important energy producers by 2040.

The study titled The Global Race for African Oil says East Africa will emerge as a global player in the oil and gas industry, raking in trillions of dollars as energy-thirsty economies like China move to buy the resources.

British explorer Tullow Oil in July last year announced it had struck crude deposits in excess of one billion barrels — enough to begin commercial production.