[ad_1]
Economy
South Africa firms beat US in deals targeting Kenya
Wednesday, May 15, 2019 21:51
By CONSTANT MUNDA
South Africa leapfrogged the US to become Kenya’s second largest foreign investor in 2017 following a raft of multibillion-shilling deals inked by firms in Africa’s most advanced economy targeting Nairobi.
The value of investments held by resident South African firms increased Sh64.34 billion, or 60 percent, during the review year to nearly Sh171.65 billion, fresh data by the Kenya National Bureau of Statistics show.
That relegated US firms to the third spot after the portfolio of the world’s biggest economy in Kenya rose by a marginal Sh2 billion to Sh159.92 billion.
The UK remained Nairobi’s largest source of foreign investment with a Sh217.84 billion portfolio despite registering a Sh3.44 billion drop from 2016’s value, the statistics show.
An economic crisis in South Africa in 2017, which saw its domestic credit rating downgraded to junk — a non-investment grade territory, prompted firms in the country regarded as Africa’s economic jewel to look elsewhere for opportunities and spread out the risks.
Distell Group in April 2017 took control of Kenya Wine Agencies Limited after buying additional 26.43 percent stake from Centum Investments PLC, increasing its shareholding in the winemaker and marketer to 52.43 per cent.
The deal was preceded by Johannesburg Stock Exchange-listed financial services group, Sanlam, which in March 2017 acquired a majority stake in PineBridge Investments East Africa, Kenya’s largest fund manager by market share.
The icing on the cake was, however, the mega-deal by UK giant Vodafone to transfer its 35 percent stake in Safaricom to South Africa’s Vodacom in May 2017.
These were among other deals that followed a State visit by then President Jacob Zuma in October 2016.
South Africa consequently accounted for a 12.4 percent of foreign investment in Kenya behind UK’s 15.8 percent, but ahead of US (11.6 percent), France (5.8 percent) and Mauritius (4.9 percent).
Overall, the stock of investment portfolio by non-residents rose 4.9 percent to Sh1.38 trillion in 2017 compared to a year earlier.
“Finance and insurance, manufacturing, information and communication; and transportation and storage industries were the main beneficiaries of investment,” the KNBS said in Foreign Investment Survey 2018.
[ad_2]
Source link
Kenyan Business Feed is the top Kenyan Business Blog. We share news from Kenya and across the region. To contact us with any alert, please email us to [email protected]