iHub Limited, a company that runs an innovations incubation laboratory for techies, has been acquired by venture capital firm BSP Fund LLC for an undisclosed sum.
BSP Fund LLC, associated with controversial investor Miguel Granier, is also acquiring majority stake in Gearbox, a company that provides equipment and space for developers of hardware and electronics.
Mr Erik Hersman, one of the former shareholders of I-Hub, in an interview Wednesday said the transaction has been completed.
Mr Hersman had 49.95 per cent stake in I-Hub prior to the deal.
The other major shareholder was Mr Josiah Mugambi, also with 49.95 per cent stake, while Ms Juliana Rotich and David Kobia had minority interest of 0.05 per cent each.
Mr Hersman declined to reveal the value of the transaction, describing it to have been nominal.
Regulatory filings with the Competition Authority of Kenya (CAK) show the combined turnover of I-Hub and Gearbox to have been Sh299.1 million in 2015, putting the combined business in the range of a medium sized enterprise.
“The share valuation was pennies, on purpose. We had built this up for the community… we felt it would be unfair if we took some monetary gain from it,” said Mr Hersman.
“… the Competition Authority of Kenya (CA) excludes the proposed acquisition of the entire issued capital of I-Hub and majority share capital of Gearbox by BSP Fund LLC from the provisions Of Part IV of the Act,” said the CA director-general Mr Wang’ombe Kariuki in his approval of the deal, arguing that the deal would not affect competition.
Both Mr Granier and Mr Hersman have hit headlines recently as some of the petitioners in a legal dispute in which shareholders of the cloud services firm, Angani, are fighting for control.
The iHub was established in 2010 as a working space for Kenya’s budding tech industry.
It subsequently developed research, consultancy and event-hosting as sources of up to 70 per cent of its revenue. Last year, the iHub said that it was changing strategy as it seeks 100 per cent self-funding.
Part of this business strategy was acquiring an investor who would inject the capital needed to drive growth.
Mr Granier was initially floated as one of four interested investors, including former ICT Principal Secretary, Dr Bitange Ndemo.