The Competition Authority of Kenya (CAK) has given the green light to the proposed acquisition of 100 per cent shareholding in Rafiki Millers Limited by Kitui Flour Mills Limited.
The Competition watchdog has granted the approval based on the finding that the transaction will neither negatively impact competition in the market for wheat milling nor elicit negative public interest concerns.
“The proposed transaction involves the acquisition of 100 per cent of the issued shares in Rafiki Millers Limited by Kitui Flour Mills Limited. The transaction, therefore, qualified as a merger within the meaning of Section 2 and 41 of the Competition Act No. 12 of 2010,” stated CAK.
According to the Act, a merger or takeover happens when an undertaking directly or indirectly acquires control over another business within Kenya which may occur through purchase, lease of shares, exchange of shares or vertical integration among others.
Merging parties whose combined turnover or assets is over Ksh. 1 billion are required to seek approval from the Competition Authority prior to implementing the proposed transaction.
“The transaction between Kitui Flour Mills Limited and Rafiki Millers Limited met this threshold for mandatory notification and full analysis as provided in the Competition (General) Rules, 2019,” added the Competition Watchdog.
Kitui Flour Mills Limited, the acquirer, is a limited liability company incorporated in Kenya and engages in the maize and wheat milling business.
It is the home to brands such as Premium Maize Flour,
Dola Wheat Flour, Dola Chapati Flour, Atta Flour, Baba Lao Maize Flour, Baba Lao Wheat Flour, Jahazi Maize Flour and Jahazi Wheat Flour.
Kitui Flour Mills Limited commands 13 per cent of the wheat milling market and is the third largest firm behind Mombasa Maize Millers (22 per cent) and Grain Industries Limited (15 per cent).
On the other hand, Rafiki Millers Limited is a limited liability company incorporated in Kenya.
Prior to the closure of its operations in April 2021, it was involved in the wheat milling and confectionery business.
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