Dubai’s Al-Futtaim Group now holds majority shares in Kenyan automobile retailer, CMC Holdings Limited after 91 percent shareholders accepted its 7.6 billion shilling ($87.91 million) offer for its 533 million shares.
CMC, which distributes Ford, Mazda, Suzuki and Volkswagen vehicles among other brands is a key player in East Africa automotive industry. The successful acquisition of the CMC group represents Dubai-based Al-Futtaim’s first venture into the sub-Saharan and Eastern Africa regions.
The investment also represents one of the biggest Foreign Direct Investment inflows into the Kenya in recent times, and is expected to highlight the appeal of the Kenyan market to global firms.
Last September, Al-Futtaim Group revealed plans to acquire the Nairobi Securities Exchange-listed motor dealer through its subsidiary Al-Futtaim Auto & Machinery Company (Famco).
This move had received endorsement from more than half of CMC’s shareholders, including top shareholders such as tycoon Peter Muthoka.
Shareholders of CMC Holdings only had until February 18 at 17: 00 hours to sell their shares to the global diversified conglomerate at $0.15 each or their shares will be illiquid.
Al-Futtaim is pleased with the acquisition and the growth opportunity the deal presents, Al-Futtaim’s Automotive President Len Hunt said, adding that the UAE-based company will be pursuing opportunities to provide tier one services across the entire automotive value chain in Kenya and the wider region.
“This includes sale, service and maintenance of new and used vehicles, machinery and equipment, in addition to the supply of genuine parts and accessories,” he said.
Marwan Shehadeh, the Group Director for Corporate Development at Al-Futtaim Group said that the company looking forward to turning CMC around back to its glory days as the leading motor dealer in East Africa, in order to add value to its employees, its customers, the CMC franchisors and the economy of East Africa.