A consortium led by New York-based Kuramo Capital Management LLC agreed to buy a stake in Feronia Inc., which owns palm-oil plantations in the Democratic Republic of Congo, for C$36 million ($29 million).
The purchase will make Straight KKM 2 Ltd, the buyer, the joint largest shareholder in Feronia, which is listed on the TSX Venture Exchange, London-based Feronia said in a statement. KKM entered into a agreement to buy 25.2 percent of Feronia’s shares for C$21.9 million in a private placement and 12.7 percent of the shares held by U.K. development-finance institution CDC Group Plc for C$14.1 million, it said.
Feronia bought three Congolese palm oil plantations from Unilever in 2009 after the consumer-products giant abandoned them as Congo collapsed into civil war in the 1990s. Between 2013 and 2017, CDC and other European development-finance institutions injected equity and debt to revive the company’s finances.
Since acquiring control, Feronia has replanted 16,600 hectares of its plantations.
Before the deal, CDC owned 68 percent of Feronia’s shares. Following the dilution resulting from the private placement and the sale of part of CDC’s holding to KKM, both companies will own approximately 37.9 percent of Feronia.
Straight KKM is a partnership between Kuramo Capital Management, a sub-Saharan Africa-focused investment management firm, and Kalaa Mpinga, a Congolese businessman. The proceeds from KKM’s private placement will be used for working capital and the expansion of the palm-oil business, the company said. (Bloomberg)