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Jeremy Awori-led Absa Bank auctions 40 vehicles linked to bankrupt Italian firm CMC di Ravenna

Formerly Barclays Bank Kenya, Absa Bank Kenya is the local subsidiary of the South Africa-based Absa Group.

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Egyptian richest man Nassef Sawiris.

Absa Bank Kenya has put up for auction more than 40 vehicles purchased by the bankrupt Italian firm CMC di Ravenna over debts and other financial obligations linked to the firm, amounting to Ksh585 million ($5.28 million).

Formerly Barclays Bank Kenya Limited, Absa Bank Kenya is a commercial bank operating as the Kenyan subsidiary of the South Africa-based Absa Group Limited.

The decision made by the Jeremy Awori-led bank to auction the seized vehicles and equipment follows a consent letter signed before Kenyan Justice David Majanja by Absa and the Italian firm after it failed to fulfil its financial obligations to the Kenyan lender, a recent report revealed.

Earlier, CMC di Ravenna was contracted by Kenya’s Central Rift Valley Water Development Agency (CRWDA) to construct the multimillion-dollar Itare dam in Nakuru County.

The Italian firm put construction on hold in November 2018. It left the site after going bankrupt and filed for insolvency in Italy to rescue its operations and avoid liquidation.

Prior to handing over the dam project to the CRWDA, CMC di Ravenna had accumulated debts and tax obligations running into millions of dollars.

Absa said the Italian company approached it in 2017 and 2018 for various financial facilities.

In total, Absa’s lawyer Kamau Karori said it loaned CMC di Ravenna Ksh585 million ($5.28 million) to purchase 98 vehicles and equipment for the dam project.

The sale will set the company on course to recover the loan. If there is a shortfall, the remaining amount will be included in a bankruptcy plan under administration in Italy and recognized in Nairobi.

The recovery of the Ksh585-million ($5.28 million) loan will set the bank on course to reduce the loans in its books below or around the KSh201-billion ($1.81 billion) mark.

As of June 30, Absa Bank Kenya had Ksh201.95 billion ($1.82 billion) in loans and advances with customers. This is lower than the Ksh208.90 billion ($1.89 billion) that it reported at the start of the year.

Awori, the bank’s managing director, received $850,800 (KSh93.20 million) in compensation in 2020.

East Africa

Ugandan tycoon Charles Mbire to pocket $1.15-million interim dividend from MTN Uganda

Mbire owns a significant 3.98-percent stake in the Ugandan telecom outfit.

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Charles Mbire.

Ugandan multimillionaire businessman Charles Mbire is on track to receive an interim dividend of Ush4.48 billion ($1.155 million) from his stake in MTN Uganda after the telecom group reported a double-digit percent increase in earnings in the first half of 2022.

MTN Uganda is Uganda’s leading telecom service operator.

Mbire, the chairman of MTN Uganda and one of Uganda’s wealthiest businessmen, owns a significant 3.98-percent stake in the Ugandan telecom outfit, which operates as the fourth operating subsidiary of the South African multinational mobile telecom company, MTN Group.

The interim dividend will be paid electronically into his bank account at a later date from the group’s retained earnings of Ush902 billion ($232.4 million) at the end of its 2022 fiscal year. It is his first dividend from the telecom company since its shares were listed more than eight months ago.

The dividend payment follows a significant rise in the group’s earnings in the first half of 2022 despite a 4.9-percent decline in voice revenue, as it looks set to replicate its stellar performance in 2021.

As a result of the company’s strong financial performance, the board of directors approved the payment of an interim dividend of Ush5 ($0.00128) per share for the six months ending June 30, totaling Ush11.95 billion ($28.9 million), which is subject to withholding taxes.

According to data retrieved from the company’s earnings report for the first six months of 2022, its profit increased by 48.1 percent to Ush193.6 billion ($50.2 million) in the first half of 2022, compared to Ush130.7 billion ($33.7 million) in the first half of 2021.

The double-digit increase in profit can be attributed to a 10-percent surge in the company’s service revenue, which was driven by a significant increase in data and fintech revenue, which were more than sufficient to offset the 4.9-percent decline in voice revenue.

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East Africa

Led by Kenyan founder Owen Sakawa, AI-powered startup Elloe acquires Flo by Saada

Elloe was founded in 2021 by Sakawa, Abhijay Rao, and Aaron Madolora.

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Owen Sakawa.

Elloe, a U.S.-based conversational commerce startup led by Kenyan tech entrepreneur Owen Sakawa, has acquired Flo by Saada nearly three months after raising more than $1 million in a pre-seed funding round led by institutional investors.

Flo by Saada is a Kenyan social commerce startup founded by Gerishon Mwaniki.

The acquisition of the startup, which launched in 2019 to enable small and medium enterprises to build solutions and process payments through USSD and programmable SMS, was completed for an undisclosed fee.

Through the acquisition, Elloe will be able to accelerate its next phase of growth by scaling operations for its corporate clients and expanding its footprint beyond its current operations in Kenya and the Philippines.

Commenting on the transaction in a press release obtained by Billionaires.Africa, Elloe CEO and Founder Owen Sakawa said: “The addition of Flo by Saada technology is a natural extension of Elloe’s offerings and fits perfectly into Elloe’s strategy. It transforms customer interactions from simple communications to conversations across the entire spectrum of customer engagement points.”

He added that Elloe will be better positioned to meet customers’ evolving needs in the future as it continues to provide businesses with embedded commerce capabilities to simplify the way that they serve, connect with, and sell to their own customers from anywhere, on any channel.

Elloe was founded in 2021 by Sakawa, Abhijay Rao, and Aaron Madolora as a first-of-its-kind AI-powered, conversational commerce platform that allows small and medium enterprises to buy and sell products online across messaging platforms such as WhatsApp, Facebook Messenger, and Instagram.

With its proprietary technology that assists small businesses in managing their digital sales and customer service through an omnichannel platform that runs on messaging apps, the startup hopes to capitalize on opportunities in the $35-billion conversational commerce market, which has the potential to reach $130 billion by 2025 in emerging markets.

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East Africa

Controlled by Kenyan tycoons, Britam Holdings hints at sale of HF Group stake

Britam has classified its 48.2-percent stake in HF Group as held for sale.

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Peter Munga.

Britam Holdings has announced that it is reviewing a transaction that could result in the sale of all or a portion of its stake in HF Group, a Nairobi-based financial services group with interests in mortgage lending, corporate, and retail banking.

Britam is a diversified investment group and a leading insurer in East Africa.

Kenyan business leaders like Jimnah Mbaru, Peter Munga, James Mwangi, and Jane Wanjiru Michuki have significant shareholdings in the group.

In its 2021 annual report, the group classified its 48.2-percent stake in HF Group as held for sale, stating that it has hired a transaction advisor to engage potential buyers and other viable options within the current fiscal period.

“The directors approved the appointment of a transaction advisor to engage various interested parties with a viable option expected to be realized within the next twelve months,” the group stated.

The move represents a strategic turning point for the group, which is reorganizing its executive structure and reviewing its investments in financial services providers to diversify its portfolio and comply with regulatory guidelines limiting investments in a bank to 10 percent of an insurer’s total assets.

Britam’s latest disclosure comes four months after it completed the sale of a 6.7-percent stake in Kenya’s largest commercial bank Equity Group to the International Finance Corporation for Ksh14 billion ($121 million).

The management also stated that options for its stake in HF Group include reaching out to strategic partners who have the capacity to accelerate and support the process of turning HF Group around as it prepares to transition into mainstream banking.

These other options may assist Britam Group in realizing optimal value from its investment when compared to a full or partial divestment as it prepares to reduce its exposure to publicly traded companies. The position aligns with the group’s new strategy to minimize investment earnings volatility to the point where it has no impact on the group’s overall financial performance.

Since the start of the year, Britam’s shares have decreased in value by more than 20 percent, from Ksh7.5 ($0.063) to Ksh5.94 ($0.0498), resulting in losses of millions of dollars for Mbaru, Munga, Mwangi, and Michuki.

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