A group of Kenyan investors is set to buy the buildings and physical infrastructure hosting Nova Schools in Tatu City from the holding company that leases the premises to the educational institution.
The Competition Authority of Kenya (CAK) said on Wednesday that it has approved the proposed acquisition of the entire issued share capital of Nova Academies Tatu City Property Limited by Heri Holdings Limited for an undisclosed consideration.
The property is currently under lease by Nova Pioneer Kenya Limited, an entity that operates seven private schools in Tatu City, Athi River and Eldoret. The schools are Nova Pioneer Tatu City International, Nova Pioneer Athi River, Nova Pioneer Tatu City Primary, Nova Pioneer Tatu City Boys, Nova Pioneer Tatu City Girls, Nova Pioneer Eldoret Boys and Nova Pioneer Eldoret Girls.
The deal, however, only covers the premises at Tatu City.
Following the completion of the deal, Nova Pioneer will continue occupying the Tatu City facilities as a tenant of Heri Holdings.
Heri was founded as an investment company in 1974 by about 20 Jomo Kenyatta-era politicians, businessmen and civil servants including Jeremiah Kiereini, Charles Njonjo and Geoffrey Kariithi, who used it to acquire stakes in companies such as DT Dobie.
Today, the company says it owns, finances and manages investments in real estate and infrastructure assets.
“The proposed transaction involves the acquisition of 100 percent of the issued share capital and loans of Nova Academies by Heri Holdings,” said the CAK in its notice.
“The proposed transaction only involves some assets of the school (buildings, land and related infrastructure). The school shall continue to operate normally with no transfer of its programmes, brand and related assets such as students, teachers and other employees.”
Although the CAK did not disclose the actual value of the deal, it noted that the combined assets of the two entities exceeded Sh1 billion, hence the requirement to seek approval from the regulator for the proposed transaction.
The value of the deal is however likely to run into the billions, considering the large capital expenditure required to set up schools that meet international standards.
The offer by Heri to buy out Nova Academies marks the second attempt by an entity to acquire the firm.
In 2018, South African property developer Summit Real Estate Proprietary Limited made a bid to acquire Nova Academies but pulled out of the deal for undisclosed reasons even though the transaction had received a go-ahead from the CAK.
Summit Real Estate, an investor in the education and healthcare sectors in South Africa, was looking to venture into other markets in the continent.
Nova Academies were founded in South Africa with two schools, and it first entered Kenya in 2015. It now operates nine facilities in South Africa and seven in Kenya.
