MAJORITY ACQUISITION OF GOVERNORS AVIATION LTD RAISES REGULATORY CONCERNS
(Posted 08th April 2016)
News are emerging that South African eco-tourism group Wilderness Holdings Limited has completed negotiations about the acquisition of 51 percent of a range of businesses in Kenya, broadly referred to as Governors Camp.
The 51 percent share acquisition, announced on the Wilderness and other economic news and data provider websites, includes Musiara Limited, Goodison Ninety One Limited, Goodison Fourty Two Limited, Governors Aviation Limited all registered in Kenya and the group’s two Rwandan companies Governors’ Camps Rwanda Limited and Governors’ Safaris Rwanda Limited.
49 percent remains with the previous owners it is understood and, at least for the time being, will the Managing Director and Marketing Director remain in place to ensure a smooth transition in the market.
Governors Camp was founded in the mid 1970’s by the late Ari Grammaticas, set up in the Mara Triangle and offered luxury under canvas as luxury was understood in those days. The camp was the first to offer inclusive packages for tourists flying in from the Kenya coast, including airstrip transfers and game drives in a fleet of dedicated 4×4’s. Ari later on added a balloon operation and the company’s Cessna 404, registered as 5Y-ZZZ was commonly referred to as Triple Zulu, flying daily between Mombasa and the Governors’ own airstrip. After seeing the success of the main Governor’s Camp did the company then add what was known as Little Governors Camp before adding, as demand rose, Governors’ Paradise and several seasonal fly camps within their concession area. The company later on invested in a camp at the foot of the Virunga volcanoes which serves as a base for gorilla trekking in Rwanda.
The acquisition of the camps and related safari businesses expands Wilderness’ East African footprint considerably, being involved so far only with the Segera Retreat in Central Kenya, a luxury lodge best described as top of the pops as far as accommodation, food and hospitality is concerned.
The transaction value was established at some 6.2 million US Dollars but is reportedly still subject to the Kenyan Competition Authority (CAK) formal approval. Completion of the transaction is expected, according to information sources, on the 19th of May this year.
What has however rang the bells within the Kenyan aviation fraternity is the 51 percent acquisition of Governors’ Aviation as part of the deal, as airlines registered in Kenya fall under the common ownership rule which requires ‘home ownership‘ of at least 51 percent in Kenyan hands.
Pundits expect the airline issue to be raised by Kenya’s aviation fraternity with the KCAA as similar transactions have in the past not always found favour with the KCAA. As an example, a year and a half ago, in the case of DVN / FSG, KCAA refused to renew the licence of Kijipwa Aviation which was acquired by the Hong Kong based group but apparently CAK and KCAA later sanctioned the full takeover of Phoenix Aviation in April 2015.
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