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Kenyan gov approves Hillcrest takeover – The PIE News

Authorities in Kenya have approved the planned acquisition by Braeburn Group of International Schools of former competitor Hillcrest Schools in the country, on condition that the former absorbs 97% of all 180 Hillcrest employees.
The Competition Authority of Kenya asserted itself in seeking to protect the interests of ex-Hillcrest employees
The decision on employee retention goes against the position taken earlier by Hillcrest, as it had issued a notice to the employees, alerting them that they would all be retrenched once the takeover process is complete.
“Regrettably, as a consequence of this transaction, Hillcrest will terminate employment of all its employees on the grounds of redundancy,” it warned in a notice issued in October. However, it explained that some of the workers would be retained in a tripartite deal with Braeburn and authorities.
Despite the position, the Competition Authority of Kenya asserted itself in seeking to protect the interests of ex-Hillcrest employees, decreeing that the takeover could only affect five out of the 180 workers.
“In regard to public interest issues, the Authority is of the view that this proposed transaction is likely to lead to negative public interest concerns.
“Specifically, the merging parties have indicated that certain administrative functions of the target business will be partly handled by the acquirer’s head office, including finance and human resource management,” CAK stated.
It added, “The Authority approved the proposed acquisition of the business and certain assets of Hillcrest Investments Limited by Braeburn Schools Limited on condition that the acquirer employs at least one hundred and 175 of the target’s 180 employees on terms that are not less favourable than what they are currently entitled to.”
“This proposed transaction is likely to lead to negative public interest concerns”
A successful takeover will see Braeburn dominate the British curriculum market segment at 12.8% of the nearly 30,000 pupils enrolled for the UK curriculum in Kenya alone – this is after inheriting the 2.6% market share currently taken up by Hillcrest.
Its rivals, according to the CAK will include the Aga Khan Academy at 7.1% of the market share, and local entities Srimad Premier Academy carrying 3.8%, and Oshwal Academy with 3.4%.
Based on the figures, the regulator observed that the proposed transaction was “unlikely to lead to substantial lessening or prevention of competition in the market for British national curriculum in Kenya”.
The acquisition will also see Braeburn become one of the biggest education groups in East Africa, the latest addition bringing the number of ‘co-educational’ international schools it owns to 17, spread over 10 campuses in Kenya and Tanzania.
The Hillcrest schools include early years, preparatory, and secondary schools, which provide British National Curriculum, iGCSE and GCE A-Levels to over 3,600 pupils.
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Author

Joseph Muongi

Financial.co.ke was founded by Mr. Joseph Muongi Kamau. He holds a Master of Science in Finance, Bachelors of Science in Actuarial Science and a Certificate of proficiencty in insurance. He's also the lead financial consultant.