KENYA – The Nairobi Flour Mills, renown for Jimbi maize and wheat brands, have put up the business for sale at an asking price of KES400 million (US$2.5M).
Prospective buyers of Nairobi Flour Mills will take over its assets including equipment, godowns, offices and two plots measuring 1.124 acres in Nairobi’s Industrial Area.
“The sale price is Sh400 million, negotiable. The owners closed down the milling plant. They are too old to manage it and this is why they are putting it up for sale,” a source familiar with the matter told Business Daily.
With a production capacity of 255 tonnes per day, the plant, the producer of Jimbi maize and wheat products has two lines for producing two kilogramme packets of flour and one line for processing one kg packets of flour.
The sale offer marks increased deal making in the packaged food business, coming soon after Kitui Flour Mills (which trades under the Dola maize and wheat brand) acquired the assets of Rafiki Millers which ceased operations in April 2021.
Last week, the Kitui Flour Millers received approval from the Competition Authority of Kenya (CAK) to acquire 100% stake in Rafiki Millers.
Although the regulator did not disclose the value of the transaction, it noted that the merging parties have a combined asset valued at over KES1 billion (US$6M), hence the need to seek regulatory approval before effecting the deal.
Demand for packaged maize and wheat food products has been driven by increased urbanisation and expansion of hotels and restaurants.
According to the regulator, the sector has attracted more players in the past decade, raising competition for established firms including Unga Group.
There are more than 40 formal grain millers in Kenya with a combined capacity to mill over 85 percent of the country’s total volume, noted the regulator.
In a statement, Joseph Choge, the Groups managing director said that the company is dealing with declining revenues due to increased competition in the milling industry, decreased demand for its products, and high cost of raw materials.
The planned transition is also aimed at meeting emerging consumer preferences and demands, especially with the increasing urban youth population.
“Looking ahead, we have observed changing consumer purchasing habits, particularly among younger consumers who prefer convenient, nutritious foods that are easy to prepare while also being healthy,” said group managing director Joseph Choge in the firm’s latest integrated report
For all the latest grains industry news from Africa, the Middle East, and the World, subscribe to our weekly NEWSLETTERS, follow us on LinkedIn, and subscribe to our YouTube channel.
