Corporate and Commercial Work
Creating structures that enhance value
Overview
The East Africa Region is according to the African Development Bank, the fastest growing region in Africa. The region has seen exponential growth in inbound foreign direct investment. Classified as a frontier market, Kenya is the gateway for investments in the region and continues to shine with large investments and big-ticket deals (including M&A transactions) taking place in agriculture, construction, education, energy, financial (banking and insurance), ICT, industrial, health, retail, tourism and transport sectors of the economy. There is a huge growth potential for the region in these sectors in addition to the nascent oil and gas sector which has attracted huge capital inflows.
Retained by both investors and investees, we have increasingly advised several entities (both local, regional, and foreign) seeking investment opportunities in the East Africa region. We are on the ground to offer local counsel and have long-standing arrangements with regional experts on transactions having cross-border aspects. Our Firm’s expertise has been tapped in planning, designing, and structuring these transactions, to not only achieve the client’s commercial and strategic goals but also to achieve optimal tax outcome within legal parameters. We are regularly consulted by foreign law firms for advisory services on local laws and regulations relating to the establishment, ownership, and operation of foreign businesses in the East Africa region, and to handle transactional work involving legal due diligence on target entities.
Our clients have relied on our expertise to plan, structure, and execute corporate transactions in a tax-efficient manner, thus reducing risks associated with these transactions.
Services
- Business set-up
- Company acquisitions
- Corporate restructuring and reorganisations
- Due diligence
- Joint ventures
Experience
Representative Transactions
- Providing counsel to a large micro-finance institution in its re- restructuring and transformational drive aimed at conversion from a non-deposit-taking to a deposit-taking micro-finance institution under the regulation of the Central Bank of Kenya. The mandate involved drafting of constitutive, share-subscription, capital-raising, debt-assignment, and transfer of business documentation and instruments between a non-operating holding company and a newly-created operating entity. We also advised on the most efficient shareholding structures to adopt in view of thin-capitalization rules under the Income Tax Act.
- Advising owners in a high-value share sale transaction involving 100% disposal of shares in a trading company. The mandate involved preparation and review of a wide range of documentation, including Non-Disclosure Agreement, Share Purchase Agreement, Shareholder and Board Resolutions, Amendments to the Constitutional Documents, Waivers, Completion Check Lists, as well as dealing with merger notifications to the Competition Authority of Kenya and obtaining approvals. The Firm advised on suitable tax structures to achieve maximum value on the distribution of dividends.
- Providing front-to-end transactional advisory to investors in an acquisition deal of a trading entity. The Firm undertook extensive legal due diligence to ascertain compliance of the target entity with contractual, corporate, legal, and tax obligations arising under various contracts, legislation, and regulations. We negotiated and drafted share purchase documentation, including tax warranties and indemnities clauses, and dealt with merger notifications and approvals at the Competition Authority of Kenya, resulting inthe successful closure of the transaction.
- Advising a foreign-based Development Finance Institution and Social Impact Investors on Legal and Regulatory requirements governing foreign investments in the East Africa region, including policies and compliance with Anti-Money Laundering (AML) and Combating Foreign Terrorism (CFT) frameworks.
Key Contacts
Chege Njoroge
Managing Partner
Wilson Gathogo
Partner