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Nakumatt 'will remain under family control?

By Attracta Mooney

The family behind Nakumatt wants to maintain majority control of the east African retailer, even if additional investors are brought in.

That’s according to a spokesman for the family business, who said plans to sell a stake to investors are at an early stage.

His comments follow reports by Reuters Africa that the company was looking to sell a 15% to 18% stake for $50 million (€37 million) to equity investors, and a further 25% to 30% to an international retailer at a later date.

This could leave the founding Shah family, which controls 90% of the retailer, with about a 40% stake in the business.

However, although additional finance will be needed to meet its expansion plans, the spokesman told CampdenFB that the business has no concrete plans to look for outside investors.

“These thoughts are still at their infancy and [the family is] currently just toying with the idea,” he said.

He added that Nakumatt would not consider an initial public offering, at least in the near future.

“About two years ago, we had thought of going through an IPO but the idea was shelved as we felt it was premature. As things stand in east Africa, this year and perhaps even next year will not provide a conducive environment for listing,” he said.

The business is currently headed by Atul Shah, credited with transforming the business his father bought in 1978 into east Africa’s largest retailer. Revenues at the company, one of CampdenFB’s top global challengers, grew by 22% between 2008 and 2010 to 26,105.9 million Kenyan shillings (€239 million).

“Ultimately, the Shah family still hopes to maintain majority control even when the deal is fully structured perhaps in the next three to four years,” the spokesman added.