US fund’s buyout of Kenya’s Artcaffé put at $34 million
US private equity fund Emerging Capital Partners (ECP) has acquired a majority stake in Nairobi-based hospitality chain Artcaffé Group for an undisclosed amount.
ECP, which last year sold its stake in another Kenyan coffee chain, Java House, to Dubai-based private equity firm Abraaj Group, Wednesday said the Artcaffé deal was informed by huge demand for the fast-expanding coffee house culture in the region.
The deal whose value was undisclosed by ECP is estimated by insiders to be worth about Ksh3.5 billion ($34.4 million).
Artcaffé, started in 2008, says it currently operates 20 full-service bakery, coffee shop, bar and casual dining restaurant outlets around Nairobi.
“There is immense opportunity in eastern Africa for casual dining concepts. Alongside population growth and increased urbanisation, demand for international cuisine and casual, high-quality dining experiences is rising,” ECP said in a statement.
Following the deal, ECP managing director Paul Maasdorp said Artcaffé will embark on a fresh round of expansion.
“The Artcaffé management team has done a remarkable job creating an exceptional dining experience and we are looking forward to working with them to bring this experience to more customers,” said Mr Maasdorp.
Artcaffé managing director Sagi Vaknin said the chain, which has 1,300 staff, will expand its range of offerings.
“With ECP’s support we are looking to bring an exceptional dining experience closer to our customers with many more stores and into their homes with an expanded delivery offering and network,” said Mr Vaknin.
Coffee shops have been on an expansion and capital raising spree in Kenya in a race to tap the country’s emerging coffee drinking culture and demand for snacks and meals.