Tourism, ICT record highest mergers in 2013

May 13, 2014
Shares

,

Out of the total number of mergers notified, hospitality and tourism and ICT recorded seven notifications each followed by the retail sector with six notifications and four notifications in the mining and exploration sector respectively/FILE
Out of the total number of mergers notified, hospitality and tourism and ICT recorded seven notifications each followed by the retail sector with six notifications and four notifications in the mining and exploration sector respectively/FILE
NAIROBI, Kenya, May 13 – Tourism and hospitality as well as Information Communication and Technology are the sectors that had the highest notification of mergers in the 2012/ 2013 financial year.

Out of the total number of mergers notified, hospitality and tourism and ICT recorded seven notifications each followed by the retail sector with six notifications and four notifications in the mining and exploration sector respectively.

The financial services also had four notifications as well as the health, aviation and motor vehicle sectors with the agriculture, insurance, media and energy having three notifications.

The real estate sector and the manufacturing sector had two notifications.

Among the approved mergers in the period under review include the 10 percent acquisition of the Pan Africa Insurance by the Hubris Holdings, 75 percent stake of Nairobi Java House by EPC Africa and 93 percent acquisition of I&M bank by City Trust Limited.

Wananchi Group also acquired 99.9 stake in Cable Television Network Limited while Dimension Data acquired 100 percent stake in AccessKenya group.

Cheki Africa Media also acquired 55 percent stake in Brightermonday.com.

Others include Woolworths Franchise Business (currently carried on by Deacons Kenya Limited) acquisition of the entire business carried by Woolworths Holdings Mauritius Limited.

During the period under review the Competition Authority of Kenya handled about 65 merger notifications with most of them found to be benign to the competition process.

The authority in the coming financial year is set to introduce mergers threshold in order to direct its enforcement in areas of high Impact.

“It is important to note that mergers can increase efficiency, leading to benefits such as lower prices, greater product choice and higher quality services. However it is also pertinent to be alive to the fact that mergers can also lead to substantial lessening of competition and therefore the Authority pays close attention to such mergers,” says Competition Authority of Kenya Director General Wangombe Kariuki in the authority’s annual report 2012/2013.

Wangombe highlighted a merger that was consummated without authorization that includes the proposed acquisition of Synovate by Ipsos.

Ipsos had acquired Synovate and was in the process to change it to IPSOS Synovate where Synovate had a strong presence which includes Kenya, Tanzania Uganda and Rwanda.

Wangombe says the transaction contravened the provisions of the Act, pointing out that the investigations were forwarded to the Director of Public Prosecution for further necessary action.

He also highlighted the unwarranted Concentration of economic power between Lafarge and East African Portland Cement (EAPCC) where he says Lafarge’s high market share and its directorship in key strategic committees (Tender and Procurement oversight and Technical committees) in EAPCC exhibited features of unwarranted concentration of economic power.

“This arrangement would unreasonably lessen, distort prevent or limit competition in the production supply or distribution of cement in Kenya,” he said.

Shares

Latest Articles

Stock Market

Most Viewed