Moi-linked Sovereign Group Shuns InterCon Purchase -

Moi-linked Sovereign Group Shuns InterCon Purchase

Intercontinental Hotel

The plan by the Kenyan government to sell 33.8 percent stake in the five-star InterContinental Hotel in Nairobi seems to have backfired after Moi-linked Sovereign Group lost interest.

According to sources quoted by Business Daily, slump in the travel sector and the exit of the anchor partner – the Intercontinental Hotels Corporation Group, are the main reasons the company gave the sale a cold shoulder.

“There is little value for Sovereign to run the hotel. The land where the hotel sits is more important compared to the hotel,” said the source.

The Privatisation Commission, which was tasked with overseeing the sale, says it has not yet received offers from local or foreign investors.

“The commission has not received any expression of interest by either local or foreign investors to buy the hotel. The existing shareholders will get first priority to exercise their pre-emptive rights as provided for in the Articles of Association,” said Joseph Koskey, the chief executive officer.

Development Bank of Kenya owns 12.9 percent stake while the Intercontinental Hotels Corporation Group holds 33.8 percent.

Sovereign Group is the largest individual local investor in the hotel with 19.2 percent stake.

The hotel closed in August 2020 after the InterContinental Hotel ended its lease agreement with Kenya Hotel Properties Limited (KHPL), the holding company for Intercon.

The InterContinental Hotels Corporation has been running the 389-room InterContinental Hotel Nairobi under a 99-year lease since April 1967.

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