Comprehensive M&A data with integrated detailed company information

Seaboard looking to take Unga private
Posted on Friday, 09 February 2018 12:55
US firm Seaboard is increasing its holding in Kenyan milling holding company Unga Group in an all-cash transaction valued at KES 1.42 billion (USD 14.08 million).

The bid of KES 40.00 per share to take the listed group private represents a premium of 36.8 per cent on the target’s closing price of KES 29.25 on 7th February 2018, the last trading day prior to the announcement.

Completion is expected by 30th September 2018, subject to the usual raft of conditions, including approvals from shareholders and the relevant regulatory bodies.

News of the proposal, which would see Seaboard picking up a further 14.1 per cent stake, taking its total holding to 49.1 per cent, led the Nairobi Securities Exchange (NSE) to suspend the trading of Unga’s stock yesterday.

The acquiror claims to be one of the largest US pork and turkey producers and processors but also operates a group of subsidiaries through its three business areas, namely foods, marine and trading and milling.

It was established in 1918, when it bought its first flour mill, and, as of 7th February 2018, had a market capitalisation of USD 4.94 billion.

Seaboard reported net earnings of USD 224.00 million on total net sales of USD 4.22 billion for the nine months ending 30th September 2017.

According to Kenyan newspaper the Standard, the corporation stated that it will propose Unga’s delisting from the NSE when the offer is unconditional in order to comply with the regulatory requirements.

The agribusiness and transportation group already wholly owns flour mills in Ghana, Zambia, Madagascar and Senegal.

It also holds stakes of 35.0 per cent or over in the national milling businesses of Mozambique, Mauritius, Gambia, Lesotho, the Democratic Republic of Congo, and South Africa.

Established in 1908, Unga is one of Kenya’s oldest companies and has domestic operations in Nairobi, Nakuru, Eldoret, as well as additional production facilities in Kampala, Uganda and Dar-es-Salaam, Tanzania.

For the year ending 30th June 2017, it posted a loss of KES 32.29 million and turnover of KES 19.53 billion.

Investor Victus will retain its 50.9 per cent ownership in the target following the deal.

© Zephus Ltd