Abraaj Group set to acquire Java with eye on African expansion

Abraaj Group set to acquire Java with eye on African expansion
A cappuccino is prepared at a Nairobi Java House outlet in Nairobi, file. REUTERS/Noor Khamis

Dubai-based private equity investor the Abraaj Group is set to complete the acquisition of restraint chain Java House from Emerging Capital Partners.

The Abraaj Group did not disclose the value of the transaction as it looks to expand Java’s operations across Africa.

The acquisition gives Abraaj Group a platform to expand Java’s product offering and replicating the success its enjoyed locally and grow it into a leading pan African food service platform.

Abraaj Group Managing Partner and Global Head of Private Equity Mustafa Abdel-Wadood said the firm would focus on acquisitions that will see Java open more outlets in Eat, west and North Africa.

“This landmark transaction, which showcases our ability to source outstanding assets across our target markets, is a compelling opportunity to build on Java House’s success story across sub-Saharan Africa, to create a true regional champion,” Mr Abdel-Wadwood said.

Founded in 1992 by Kevin Ashley, Java has grown to become one of the country’s best eateries with 60 outlets spread across Kenya, Uganda and Rwanda.

Emerging Capital Partners acquired a majority stake in Java House in 2012, funding its expansion.

Besides the popular coffee house restaurant, Java also operates Planet Yoghurt as well as 360 Degrees Artisan Pizza.

Java House also operates commercial coffee roasteries, providing quality coffee and bean sales to its own stores and to supermarkets, hotels, restaurants and wholesale buyers.

Java House currently serves over 320,000 guest checks per month with a staff contingent of 2,000 employees.

It is this particular growth that the Abraaj Group hopes to replicate across the continent.

“Africa’s rapidly expanding middle class, sustained population growth and increasing urbanization is creating compelling investment opportunities in multiple sectors, and we believe Java House is ideally positioned to benefit from these trends,” he stressed.

Java House chief executive officer Ken Kuguru welcomed the entry of Abraaj Group, exuding confidence to position the firm as the go to restaurant across the region.

“The Abraaj Group is that partner of choice and we look forward to working closely with their team to extend our market leadership position across the continent,” Mr Kuguru said.

The group has $3.2 billion (Sh320 billion) worth of investments across Africa as banks on investment diversification to grow returns.

Abraaj also owns a significant stake in Brookside Dairies.

The transaction will close once customary closing conditions and regulatory approvals are obtained.

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