Seaboard Corporation, the company whose subsidiary was involved in the controversial importation of maize last year in Kenya has proposed to buy Unga Holdings Limited a listed company associated with the family of Phillip Ndegwa for Sh2 billion.

The late Phillip Ndegwa: Family selling stake

It also wants the company to be delisted from the Nairobi Securities Exchange once the deal is done.  The balance of the 38.5 million shares which are not part of the deal will be owned by Victus Limited, an investment company based in Nairobi.

Victus Ltd is owned by a company associated with President Daniel arap Moi’s Kabarak High School and with Mawara Ltd, which belongs to former East African Breweries chairman Mr. Jeremiah Kiereini, as well as with First Chartered Securities, associated with the families of the late Philip Ndegwa.

According to a notice published on February 8, Victus Limited has announced that it will not seek to increase its shareholding of issued shares and has supported the take-over.

The move is going to place Seaboard Corporation at the heart of maize industry in the country and through Unga, it will have a chance to enter the agricultural sector.

In an advert appearing in the Kenyan papers, the American company says the deal should be completed by September 30, 2018.

At the moment, Seaboard holds 2.2 million ordinary shares each valued at Sh5 of Unga Holdings representing only 3 per cent of the issued share capital. They are now offering Sh40 for each ordinary share subject to approval by the NSE.

Owned by the family of American milling billionaire Steven J Bresky, the US company is today one of the largest pork production and processing companies in the US and also owns about 50 per cent stake in Butterball LLC the largest vertically integrated turkey producer and processor in the US.

Steve Bresky: CEO of Seaboard

In Africa, the company owns several milling operations and commodity trading. The companies are in Ivory Coast, South Africa, DR Congo, Nigeria, Madagascar, Lesotho, Senegal, Mauritius, Mozambique,  Botswana and Ghana. The others are Ghana and Mauritius.

The compulsory acquisition by a company founded in 1918 will bring experience to Unga, one of the oldest millers in Kenya.

In 2013, the Ndegwa family diluted their ownership of Unga Group when they created 25 million shares for Victus Limited in a swap that saw the Ndegwa family acquire Ennsvaley Bakery in a transaction valued at Sh446 million based on Unga’s then trading price of Sh17.85 per share.

Seaboard owns Unga millers in Uganda and various other milling concerns.

Unga Group Plc prides itself on being Kenya’s oldest and still one of the largest millers, with over a century of heritage in flour milling.

Founded in 1908, Unga Group has had a strategic investment partnership with Seaboard Corporation in which saw the formation of  Unga Holdings Limited in which Unga Group Plc owns 65% and Seaboard Corporation 35% before the current offer.

Unga Holdings Limited which is on offer has subsidiaries  that include Unga Limited, Unga Farm Care (EA) Limited, Ennsvalley and Unga Millers (U) Limited. Over 90% of the company’s revenue is derived from Kenya with the remainder attributed to sales in Uganda, Tanzania and Rwanda.

 

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