The U.S. $2 billion Phoenix Group has invested an undisclosed sum in Karuturi Global, a producer and exporter of cut roses, to help the latter pay its debt and revive its Kenya operations.
The investment comprising of a blend of debt and equity is expected to help Karuturi meet its current debt obligations and leapfrog it towards restarting its operations following the conclusion of a 4-year receivership in Kenya, Karuturi said in a BSE filing on March 19. “The investment into Karuturi was a part of the firm’s expansion plan for the farming business. This investment is timely and adds floriculture and Kenya to our growing basket,” said Gaurav Dhawan, executive chairman of Phoenix Group.
“On 19 January 2018, the High Court of Kenya ruled in favour of closure of the dispute between the two parties based on a compromise affidavit. Karuturi was obligated to pay the court the approved amount and redeem the farm in next 90 days,” said Ram Karuturi, chief executive officer of Karuturi Global. Pheonix Group’s investment will help the firm repay debts as obligated by the high court in a week or less, he added.
Karuturi’s Naivasha farm in Kenya has 500 acres of land with 300 acres of greenhouses valued at over $100 million. The farm produces about 33 million roses annually for export to Europe, accounting for about 10 per cent of Kenya’s exports of cut flowers. The CEO said the company will re-employ ex-employees and re-establish all social benefits.