Nairobi: The Privatisation Authority, acting on behalf of the government, has commenced the process of selling the renowned Intercontinental and Hilton hotel properties, both of which have remained non-operational since the years 2020 and 2022, respectively. The government has designated a transaction advisor to oversee this transaction.
The task of guiding the privatisation of these prominent properties has been entrusted to Nairobi-based Standard Investment Bank (SIB), with the cost of this transaction estimated at Ksh 10.8 billion.
This move is aligned with the government’s overarching objective of privatising a minimum of 26 state-owned enterprises, many of which are grappling with financial difficulties or have ceased their operations.
Upon the successful completion of this sale, the government anticipates a capital infusion, as investors have exhibited considerable interest in acquiring these valuable assets.
In addition to their role in the hotel privatisation process, Standard Investment Bank will provide advisory services for one year concerning the privatisation of the Kenya Development Corporation (KDC). Hilton Hotel is under the ownership of KDC, representing the State’s stake in the establishment.
With the conclusion of the sale, the government will relinquish the majority stake it holds in these prime real estate assets.
The State currently possesses a 40.57 per cent ownership in International Hotels Kenya Limited, the proprietor of Hilton Hotel, and a 33.8 per cent share in Kenya Hotel Properties Limited, the owner of Intercontinental Hotel.
Hilton Hotel, which had operated for 53 years in the country, ceased its operations in April 2022. Its strategic location within the heart of Nairobi’s Central Business District (CBD) had been a key factor in its historical success.
Conversely, InterContinental Hotel shuttered its doors in August 2020, citing operational challenges. The lack of government investments in these two properties, where it holds a majority stake, ultimately led to the withdrawal of investments by shareholders from both hotels.