Distell to buy Kenya state liquor business

NAIROBI — Kenya’s government plans to sell a stake in a wines and spirits marketer to SA’s Distell and to offload its shareholdings in three luxury hotels, its Privatisation Commission said on Friday.

The commission did not say how much it expects to raise.

The sales were first announced in 2011 as part of a plan to help improve the state’s finances and to transfer the running of businesses to the country’s private sector.

Kenya’s 2012-13 budget assumes a deficit of 250.3-billion Kenyan shillings ($2.95bn) or 6.5% of gross domestic product.

The government has large shareholdings across East Africa’s biggest economy. It plans to retain stakes in strategic assets such as energy and telecoms.

The government would sell a 30% stake in Kenya Wine Agencies Limited (KWAL) to Distell and KWAL’s employees, the privatisation agency said in a newspaper advertisement.

The commission also plans to offload several government stakes in large hotels, including a 40.57% shareholding in International Hotels Kenya, Limited, which owns the Hilton Hotel in downtown Nairobi.

It will offload a 33.83% stake in Kenya Hotel Properties Limited, which runs the Intercontinental Hotel, and a 39.11% stake in Mountain Lodge, which operates under the TPS Serena brand.

The privatisation commission said the hotel sales would be through negotiations involving pre-emptive rights, and that this and the sale of the 30% stake in KWAL were expected to be completed by June 30.

It said the rest of the shares in KWAL would be sold within two to four years.

The government owns shares in KWAL through the Industrial and Commercial Development Corporation, while the Kenya Tourist Development Corporation holds its shares in the hotels.

Tourism is an important source of foreign exchange in the country of more than 40-million people, earning 96-billion shillings last year.

The government has previously announced plans to sell its shareholding in the country’s oil pipeline company and its main power producer, Kenya Electricity Generating Company. Reuters