KENYA – Nairobi Securities Exchange-listed Flame Tree Group has acquired four brands and 60 employees of a snacks and spices manufacturer, Chirag Kenya, in a bid to grow its revenue base.
Flame Tree said in a statement Thursday that the acquired brands posted a total turnover of Sh90 million last year, indicating a strong potential to boost the company’s top line.
Flame Tree, which listed on the NSE last year, manufactures plastic water tanks, mobile toilets and Zoe body lotion.
“The acquisition provides Flame Tree Group an established platform for growth in the food space. It is also in line with our strategy of creating a diversified FMCG business – manufacturing across Africa and building a portfolio of much-loved African brands,” said Flame Tree Group managing director Heril Bangera.
The four brands include Natures Own, Chigs potato crisps, Honeycomb biscuits and Gonuts.
“From a financial perspective, we believe this is a highly earnings accretive acquisition. From a strategic perspective, we are delighted to add new brands to our food and snack portfolio, which already includes Happy’s. I am particularly excited about our entry into the spices category with Nature’s Own spices,” said Mr Bangera.
Under the new deal, Flame Tree Group will also absorb 60 employees who have been working at Chirag Kenya including the manufacturing plant and its supply resources.
The company did not disclose the acquisition cost, but said the deal was financed through internal cash reserves.
With the acquisition, Flame Tree also aims to get a bigger share of the breakfast cereals market.
Chirag Kenya is owned by Chirag Amin which describes itself as a medium sized company currently dealing with snacks and spices.
Mr Bangera started Flame Tree Group in 1989 while aged 18 under the name Roto Moulders Ltd while pursuing a mechanical engineering degree from Bangalore University in India, depending on his father Fredrick Bangera to manage it until he graduated in 1991.
In 2003, Roto grew to Flame Tree Group, a diversified company making household products such as Roto Tanks and Zoe beauty products.
The company has 1,000 employees across Eastern Africa and listed in November last year under the NSE’s Growth and Enterprises Market Segment (GEMS).
March 12, 2015; http://www.businessdailyafrica.com/Corporate-News/Flame-Tree-Group-acquires-spices-maker-Chirag-Kenya-/-/539550/2651536/-/11kymtsz/-/index.html