VENTURES AFRICA – Recent acquisition of Kenyan companies by foreign multinationals will provide multi-billion-dollar windfalls for local entrepreneurs, experts reveal.
Findings suggests that several billionaire entrepreneurs are selling their stakes in local companies to foreign firms eager to tap into the East African market and have a preference for acquisition as a faster and cost efficient medium of entry into the region.
According to Business Daily, sporadic deals in the past year have attracted multinationals from across Africa, Asia and Europe with concluded acquisitions involving firms such as Fina Bank, Mercantile Insurance, Kenya Data Networks (KDN) and Swift global.
Other potential buyout deals include that of AccessKenya, Scangroup, KenolKobil, CMC Holdings, and Resolution Insurance.
Analysts have noted that most agreements are aimed at generating capital for cash-strapped firms or at providing expertise in resource and operational management to ensure sustainable business development for the growing economy.
“The deals are a reflection of the dynamism and confidence in the Kenyan economy,” said Robert Bunyi, an analyst at Mavuno Capital.
“Entry of multinationals will raise competition in the local market and this is good for consumers.”
A comprehensive analysis of both concluded and pending deals provides local entrepreneurs with two significant opportunities.
Firstly it offers local business owners the opportunity to recoup or profit from long-term investments, alternatively providing entrepreneurs with an easy medium to exit troublesome and costly ventures.