Hospitality sector in Kenya has been facing a lot of challenges after Covid-19 travel curbs. Several top hotels have either closed or witnessed ownership changes.
The hospitality sector in Kenya has been facing a lot of challenges after Covid-19 travel curbs. Several top hotels have either closed or witnessed ownership changes. Many leading hotels, like Hilton, InterContinental, and Laico Regency in Nairobi’s city centre, closed operations amid the Covid-19 economic fallout. Of late, the sector has been witnessing a lot of investment activities.
Mauritius-based private equity firm Adenia Partner’s discussions to fully acquire restaurant chain Java House are reportedly at a very advanced stage. Java was opened by an American in 1999. After its first coffee shop came up at Adam’s Arcade in Nairobi, the chain grew into 75 branches in Kenya, four in Uganda, and three in Rwanda, and has previously sought to expand to Dar es Salaam, Lagos, Accra, and Lusaka. Java is the biggest restaurant chain in the region with 82 outlets.
Adenia is negotiating to acquire the stake owned by the UK-based fund Actis. The estimated value of the deal is between Sh2.5 billion and Sh3 billion and is expected to deepen its presence in Africa. It is already present in seven African countries including South Africa, Kenya, and Ghana. Earlier, Adenia acquired stakes in the retail chain Quickmart in 2019. It has also acquired stakes in Reds Land Roses which deal in fresh cut roses, heavy construction equipment dealer Kanu Equipment and Africa Biosystem Limited—which deals in health kits. It has been observed that the PE fund has preferred sectors such as agribusiness, hospitality and health sector deals in the continent. The other deals of the UK fund in Kenya include Nairobi’s Fairview Hotel, Town Lodge and City Lodge in Two Rivers for an estimated Sh1 billion.
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Some of the deals that took place in the last year include Kasada Hospitality Fund backed by the Qatar Investment Authority (QIA) acquisition of Crowne Plaza Hotel for an estimated Sh4.6 billion, the sale of the Norfolk and Fairmont Mara Safari Club to a Nepalese tycoon for Sh2.8 billion and offloading of Nairobi’s Fairview Hotel, Town Lodge and City Lodge Two Rivers to Actis.
