Mauritian conglomerates IBL Limited and CIEL Agro Limited have started transferring the ownership of Transmara Sugar Company Limited from their subsidiary Alteo into their direct control.
The two conglomerates are moving the Kenya and Tanzania sugar production operations from the umbrella of Alteo under a new investment vehicle known as Miwa Sugar Limited, which was incorporated earlier this year.
The stake in Transmara Sugar currently stands at 69.2 per cent, after Alteo bought an additional holding of 18.2 per cent of the miller earlier this year for $8.2 million (Sh1 billion) from Kenyan private investors who co-own the firm. The purchase price of the additional stake valued the sugar miller at Sh5.5 billion.
Alteo took the controlling stake in Transmara Sugar in 2015, adding it to a portfolio of sugar firms in Mauritius and Tanzania, where it operates TPC Limited with an effective stake of 45 per cent.
“The spinoff of Alteo’s overseas operations in Kenya and Tanzania into Miwa Sugar has been initiated. Miwa Sugar, which will be an associate of IBL Ltd, will continue to develop its regional footprint mainly in East Africa, while Alteo remains focused on the local cane activities, coupled with property development in Mauritius,” said IBL Ltd in a statement on its full-year results to June 2022.
Transmara Sugar, which was established in 2011, produced 92,375 tonnes of sugar in the 12 months to June 2021, up from 72,549 tonnes in the preceding year.
Once completed, the transfer of Transmara will take to two the number of businesses in Kenya that IBL Ltd will hold a direct stake, after Naivas.
IBL in June led a consortium of international investors that bought a 40 per cent stake in supermarket chain Naivas through an investment vehicle called Mambo Retail for $151.97 million (Sh18.6 billion).
The consortium acquired the stake from the family of Naivas founder Peter Mukuha Kago, IFC, German fund DEG, and PE firms Amethis and MCB Equity Fund.