Competition Authority of Kenya approves VIVO, KFC East Africa joint venture

KENYA – The Competition Authority of Kenya (CAK) has approved the 50:50 joint venture deal between KFC’s East African franchise owner and the regional fuel and motor oil marketer Vivo Energy which will see KFC open fast food outlets in Vivo properties in Kenya, Uganda and Rwanda.

“It is notified for general information that in exercise of the powers conferred upon the Competition Authority by section 46 (6) (a) (ii) of the Competition Act, the Competition Authority has authorised the proposed transaction as set out herein,” CAK director general Wang’ombe Kariuki said in a notice in the Kenya Gazette last week.

Vivo will manage and operate the restaurants on behalf of Kuku Foods which remains local franchise holders of the KFC brand in the three markets.

Through this joint venture, it will see the US first food franchise KFC make Rwanda debut with its first restaurant. Though the JV has not indicated a specific timeline for the planned entry into Rwanda.

KFC will now expand beyond the thirty-five outlets operated by Kuku Foods in the region which is 22 restaurants in Kenya and 8 in Uganda.

The five KFC restaurants operated by Kuku Foods Tanzania, the KFC franchisee in Tanzania, will not form part of the transaction.

“The joint venture will enable a significant increase in the number of KFC restaurants in the portfolio in the coming years.’’

 ‘’It is envisaged that many of the new restaurants will be opened at Vivo Energy’s network of service stations across Kenya, Uganda and Rwanda, which leverages Vivo Energy’s retail footprint, with more countries to be considered in the future, based on market opportunities,” KFC said in a statement.

Vivo Energy chief executive Christian Chammas, says the prospective partnership is modelled along a KFC joint venture model the company pioneered in Botswana and Côte d’Ivoire.

“Kuku Foods shares our ambition to invest in order to grow the number of restaurants and give more African customers access to the internationally renowned KFC brand.’’

‘’This partnership further demonstrates our ambition to continue to offer more convenience to satisfy the evolving needs of our growing number of African customers.”

Derrick Van Houten, Group CEO of Kuku Foods and Principal Operator of the KFC franchises, which launched the first KFC outlet in East Africa in 2011, says he expects the partnership to energize the remarkable success that the business has seen over the last eight years reports 256 Business NEWS

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