A secret company registered in the British Virgin Islands has been roped in the Ksh1 billion deal to buy Nairobi’s Fairview Hotel, Town Lodge and City Lodge Two Rivers.
Revelations indicate that Jamison Valley Holdings will buy the hotels in collaboration with equity firm Actis.
The two have formed a special purpose vehicle (SPV) listed in Mauritius called Msafiri Limited. Msafiri has a company named Ukarimu real estate, which will buy the hotels.
“Jamison does not intend to disclose any additional information, including details of its structure to any third parties other than those contained in the Commission’s Merger Inquiry Notice No. 26 of 2021 dated 16th September 2021,” said Sandya Booluck, senior analyst, Mergers and Acquisitions, at Comesa Competition Commission as quoted by Business Daily.
The hotels are currently owned by City Lodge Group, which is planning to exit the East African market after selling the hotels.
“The parties have submitted that Ukarimu has been incorporated by Msafiri Limited (“Msafiri”), a special purpose vehicle incorporated under the laws of Mauritius, by Actis Hospitality Mauritius Limited. Jamison will, prior to the transaction, acquire shares in Msafiri,” said Ms Booluck.
In December 2020, the group announced that it will also sell its City Lodge Hotel in Dar es Salaam, saying that it has already received an offer from a willing buyer.
“Shareholders are advised that following receipt of an unsolicited non-binding offer for the proposed acquisition of City Lodge’s East African operations, comprising of its hotels situated in Kenya and Tanzania, the company has entered into negotiations which, if successfully concluded, may have a material effect on the price of the Company’s securities,” said City Lodge Hotel Group at the Johannesburg Stock Exchange.
It was later revealed that Tanzania’s City Lodge Hotel in Dar es Salaam would be sold to Faraja Limited, also owned by Actis for Ksh7.3 million.
City Lodge acquired its first hotel in Kenya in 2012, Fairview Hotel, before opening another outlet at Two Rivers in 2018.
Fairview Hotel has 127 rooms, while City Lodge Hotel at Two Rivers has 171 and Town Lodge Upper Hill 84.
The hotels have been performing below expectations, with a cumulative loss of over Ksh3.64 billion for the Group in 2020.