British bank note printer De La Rue has said it is investing Sh286 million in the expansion of its bank note and security printing facility in Kenya.
This is seen as upping of stakes in the middle of a hotly contested currency printing tender, which the UK firm had initially won on account of local content.
It, however, said the investment was supposed “to strengthen and underpin its local operations.”
The firm Tuesday said this was part of a planned “long term investment” of Sh1.4 billion to upgrade the Ruaraka-based plant to become a regional hub for East Africa and the continent.
“The investment in expansion of the site will standardise the firm’s global manufacturing footprint and increase its overall flexibility and capability,” said De La Rue’s marketing director, Robin Mackenzie in the statement.
“This phase of the project is on plan for completion early 2018 and has brought together approximately 100 skilled Kenyan tradesmen from the local area,” he added.
The firm is currently involved in a landmark court battle to salvage its lucrative money printing business with the government.
De La Rue’s contract to print Kenya’s new-look bank notes that comply with the constitution was cancelled by the procurement watchdog early this year after the agency ruled that the Central Bank of Kenya (CBK) had awarded it unlawfully.
The Public Procurement Administrative Review Board said De La Rue, listed on the FTSE 250 in London, should not have received a 15 per cent preference margin on tender, which is given to bidders of services when goods are manufactured domestically.
Lawyers for the central bank argued that De La Rue’s bid qualified for the preference margin because the majority of the notes would be printed at the facility.
However, the board ruled that because the contract was awarded to De La Rue International, the preference margin should not have been applied.
It ordered that all four tenderers be re-evaluated within 14 days.
The three other bidders were Giesecke & Devrient of Germany, the petitioner Swedish Crane Currency and Oberthur Fiduciaire of France.
The CBK has appealed against the decision of the High Court, arguing that under the circumstances, the ownership of the winning bid was irrelevant.
De La Rue has also appealed against the procurement board’s decision.