KENYA – Unga Group, a Kenyan-based holding company with investments in flour milling and manufacturing of human nutrition products and animal feeds has entered into an asset purchase agreement with Bigcold Kenya Limited for its subsidiary Ennsvalley Bakery Limited, as it seeks to cut costs and improve efficiency.
The leading milling and baked goods company has indicated that the transaction is subject to meeting certain conditions prior to completion.
“Following discussion, BigCold Kenya Limited and Ennsvalley Bakery Limited have entered into an asset purchase agreement on July 26, under which, subject to satisfaction of certain conditions and upon completion, Ennsvalley shall sell and BigCold shall purchase Ennsvalley’s assets,” said Unga Group in a notice.
The company has advised investors to exercise caution while dealing in its shares at Nairobi Securities Exchange.
Unga group first acquired a 52% stake in the baked goods company in 2015 for about Ksh 54O million (US$5 million) from Kenya’s sole inflight caterer NAS Holdings.
The transaction which was undertaken through its joint venture with Seaboard Corporation, UNGA Holdings Limited, saw the Nairobi Securities Exchange-listed firm re-enter the baking business after its sale of Elliots Bakeries in the 1990s.
The transaction also enabled the miller to diversify its business which was mainly comprising of milling maize and wheat grains and manufacture of animal feeds.
Following the transaction, Unga became a major baker of breads, rolls and pastries that still strictly follows Schneider’s choice of traditional recipes.
The buyer of the assets, BigCold is Kenya’s leading cold storage and logistics company.
The company is the first food storage and transport company in East Africa to get the Food Safety System Certification 22000 (FSSC 22000).
Specializing in transport solutions for frozen, chilled and ambient goods, Bigcold offers comprehensive, sophisticated and customized cold chain solutions to players such as Yum! Brands – the company behind KFC and Pizza Hut.
The company has also partnered with SimpliFine, a food production company offering accessible, locally sourced meat, vegetables, baked goods and other foods to restaurants, hotels, and retailers across East Africa.
Leveraging on BigCold’s advanced temperature-controlled supply chain and operational expertise, SimpliFine is set to deliver quality food to customers efficiently and safely in the local market and abroad.
Historically, the absence of a temperature-controlled supply chain has resulted in spoilage of up to 60% of locally-produced food, decreasing farmers’ income and increasing consumer prices.
The lack of a consistent supply of quality products has also resulted in many hotels, restaurants and catering companies relying on expensive imported goods.
With the backing of BigCold’s technology, SimpliFine is also set for a rapid expansion in Kenya, seeking to launch 19 new meat and vegetarian products.
This follows the recent acquisition of Alpha Fine Foods, a Kenyan producer of premium meat products, by SimpliFine’s parent company, BlackIvy.
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