Ascent Capital buys Sh1.6bn stake in packaging firm Dune
Dune Packaging Limited officials receive their trophy from former NSE CEO Geoffrey Odundo (right) after emerging position 63 during the 2015 Kenya Top 100 Mid-Sized Companies Survey awards on October 9, 2015.
Private equity firm Ascent Capital has expanded its operations in Kenya with the acquisition of a 49 percent stake in paper manufacturer Dune Packaging Limited for Sh1.6 billion.
The deal has been revealed in the Competition Authority of Kenya (CAK) approval of the proposed transaction, which includes Ascent Capital’s rights such as the appointment of senior management, control of business plans and budgeting decisions despite its minority stake.
The competition watchdog has approved the acquisition of the stake with no conditions.
“This approval is based on the finding that the transaction is unlikely to neither negatively impact competition in the paper and polypropylene packaging market, nor elicit negative public interest concerns, two key considerations during merger analysis,” said the CAK in a statement.
The regulator did not disclose the deal value but other sources said the minority stake was priced at Sh1.6 billion.
Dune Packaging is incorporated in Kenya and is involved in the business of manufacturing paper packaging materials used in various industries including food, beverage, pharmaceutical and retail.
The firm has a subsidiary —Tiger Packaging Limited, which manufactures woven polypropylene bags.
The packaging manufacturer has itself been an acquirer in the market having bought out Palm Tree Kenya Limited, a manufacturer of paper and paper products, in February 2023.
Ascent Capital has expanded its portfolio companies in Kenya through the acquisition.
The private equity firm has stakes in ACME Containers Limited, a manufacturer of plastic products and controls stakes in Platinum, Premier and Momentum Credit, which all deal in the provision of loans to individuals and small and medium-sized enterprises.
Ascent Capital's portfolio of companies in Kenya includes Viva Insurance Brokers Limited, Eezy Track Limited, Diani Beach Hospital Limited and Valley Hospital Limited.
Ascent Capital is controlled by Ascent Rift Valley Fund II, an entity managed by Ascent Capital Management Africa II Limited, which forms part of the Ascent Capital Group.
The PE fund is active in other regional markets including the Democratic Republic of Congo, Uganda and Zambia.
In 2022, the private equity fund announced the final close of its Ascent Rift Valley Fund II at more than Sh17 billion ($128 million) from which proceeds are expected to fund investments in small and medium enterprises in East Africa. The fund primarily invests in the sectors of manufacturing, wholesale and retail trade, financial services, education, healthcare and agro-processing.
