Mauritius-based Adenia Partners is the firm behind buyout of Kenya's emerging retail chain Tumaini Self Service adding to the list of foreign companies jostling for a piece of the local retail market.
Adenia, a private equity (PE) firm, through Sokoni Retail Kenya, its special purchase vehicle, acquired a controlling stake in Tumaini and its local partner says it has set plans in motion that will see it become the leading retailer in the region.
The Tumaini buyout adds to the acquisition of Ukwala Supermarkets by Choppies of Botswana in 2015, which has since pursued an aggressive expansion drive that has seen it increase its store count.
The Adenia deal is the latest among the 24 PE deals announced in 2018, the largest share in the region, compared with 18 in 2017, according to East Africa Venture Capital.
Tumaini said in an earlier correspondence with the Daily Nation that Sokoni has provided new capital that will be used to expand the business.
The transaction has been approved by the Competition Authority of Kenya (CAK).
"It is notified for general information that in exercise of the powers conferred upon the Competition Authority by Section 46 (6) (a) (ii) of the Competition Act, the Competition Authority has authorised the proposed transaction as set out herein," the regulator said in a Kenya Gazette notice.
The exact stake that Sokoni has acquired in Tumaini was not revealed but it is enough to give it control, the CAK disclosed.
"Sokoni has come on board, as a strategic investor, to assist Tumaini achieve its goal of becoming a leading retailer in Kenya," Tumaini said without divulging the stake or value of the transaction.
"Tumaini will begin an expansion plan to meet growing demand for retail goods and services in convenient locations in Nairobi's estates and neighbourhoods."
Tumaini is estimated to have more than six branches in Nairobi, most of them in the city's outskirts such as Rongai and Utawala.
Private equity provide growth capital for the rapidly expanding SME economy, investing in businesses with an annual turnover of less than $30 million and employing fewer than 150 employees.