The giant grain milling business of the late Mombasa tycoon Tahir Sheikh Said famously known as TSS, is set to be taken over by rival Ustawi Grain Millers Limited (UGML), years after it was placed under receivership over unpaid bank debts.
The value of the deal was not immediately available even though a notice seen by the Nation showed that the deal was excluded from Section 42(1) of the Competition Act 2010, which touches on mergers and acquisitions.
“In exercise of the powers conferred by Section 42(1) of the Competition Act, 2010, the Competition Authority of Kenya excludes the proposed purchase of all the assets of Tahir Sheikh Said Grain Millers limited (under receivership) (TSS) by Ustawi Grain Millers Limited (UGML) from the provisions of Part IV of the Act,” said Adano Roba, acting Director-General of the Competition Authority of Kenya in the notice dated April 11, 2023.
The regulator attributed its nod to the fact that the deal would not negatively affect competition adding that although the combined turnover of the parties for the preceding year, 2021, which is higher than assets, was above one billion shillings, the target had no turnover.
UGML was established in August 2020 and produces flour products under the Umoja and Wando brands. Umoja is Ustawi’s premier brand for maize flour.
TSS died in January 2017 while undergoing treatment in South Africa. The deceased businessman built a vast business empire that gave him immense political influence in Lamu, especially during the Kanu era when he was a prominent financier of the political outfit and its candidates.
His empire started in 1968 transporting building materials, fuel, coffee, and tea across Eastern Africa including Zaire, Sudan, and Egypt.
TSS investments spanned coffee export under Juja Coffee exporters, shipping, cotton ginning, and salt in addition to the TSS Bus Company, Pop-in fuel station, and TSS Grain Millers in the industrial area of Shimanzi.
While some were successful for many years, others such as the Al Wahat Beach hotel that he built in Nyali in 1993 did not stand the test of time.
Several of TSS’ businesses hit a rough patch about eight years ago amid a pile-up of debt including his flagship TSS Maize Millers, which was put under receivership.
In court documents, the billionaire blamed the change of fortunes on mismanagement by his children and brother-in-law after he stepped aside from the day-to-day running of the firms in 2010 due to health problems.
TSS said he started receiving notices in 2015 from financial institutions and was shocked to learn that from 2010 the companies had borrowed heavily for reasons he did not know of.
