The Competition Authority of Kenya (CAK) has unconditionally approved Kenafric Manufacturing’s proposed acquisition of business and assets of Economic Industries Limited.
The approval comes after the target entity expressed the intention to exit and liquidate the business.
Kenafric Manufacturing Limited is a company that manufactures footwear, food, polyvinyl chloride, ethylene-vinyl acetate, and stationery products. Economic Industries, on the other hand, is an entity involved in manufacturing and distributing office and school stationery products and exercise books.
The deal will give Kenafric control over Economic Industries. As a result, Kenafric is poised to expand its activities in Kenya’s stationery market when the deal is finalized.
CAK approved the proposed acquisition after an analysis of the impact of the transaction on competition and public interests. “This approval has been granted based on the finding that the transaction is unlikely to negatively impact competition in the market for stationery, nor elicit negative public interest concerns,” noted CAK in its official statement.
The Kenyan stationery market has experienced significant growth over the past few years. In 2021, the sector registered a remarkable year-on-year growth of 23.33 percent in value shipments.
Currently, the sector is dominated by Twiga Stationers and Printers Ltd, whose market share stands at 49.4 percent compared to Kenafric’s market share of 12.3%. However, according to data by CAK, Kenafric’s market share will increase to 22.6 percent following the acquisition of Economic Industries.
The proposed acquisition will increase Kenafric’s ability to compete with other brands, including Twiga Stationers, Kartasi Industries Limited, and Guaca Stationers Limited.
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