Guys,

The Kuwaits are out to buy Hotel intercontinental Nairobi, please read below the East African news. This will affect a lot of Hotels in kenya today. Most hotels which will be hit hard are, Kisumu Sunset hotel, Kabarnet Hotel, Bomas Hotel and kakamega hotel.

I do feel the Gema has smelled the STRONG wind of Majimboism blowing almost everywhere and they want to dominate other regions economically even if there is majimboism or not.

Please read below for more details, all these are Kimunya, GEMA and CBK leader strategy. How many are still secrets??.

Paul Nyandoto

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After the Grand Regency Libyan buy out, Kuwaitis eye Intercont
By JOHN MBARIA
Special Correspondent

Even before the dust settles on the controversy over the sale of the Grand Regency Hotel to interests linked to Libya – – it has emerged that a company out of Kuwait, the M.A. Kharafi Group is in discreet discussions with both the management of the Kenya Tourism Development Corporation (KTDC) and the Intercontinental Hotel Group to buy the Hotel Intercontinental Nairobi.

KTDC owns 33.8 per cent shares in the Kenya Hotel Properties Ltd (KHPL), that owns the Hotel Intercontinental in Nairobi. Other shareholders are the Intercontinental Hotel Group, the National Bank of Kenya and the Sovereign Group Ltd.

Curiously, the Ministry of Finance, which technically owns all public assets, has been kept in the dark about these quiet discussions.

The acting director general of the Privatisation Commission of Kenya, Solomon Kitungu, told The East African that he was not aware of any discussions to sell the Hotel Intercontinental. He said that while the management of KTDC had in the past expressed interest in disposing of some of the assets owned by the corporation, Treasury had informed them that all sales of public assets must be done in accordance with the newly_enacted Privatisation Act.

Although the managing director of KTDC Obondo Kajumbi, has denied that there any plans to dispose any of the shares owned by KTDC in the hotel, correspondence seen by The EastAfrican show that a senior executive of the Nairobi Intercontinental Hotel has been in communication with the state_owned company to recommend the sale of the hotel to the Kuwaiti group.

In the letter, dated March 20, the director of operations at the Intercontinental, Karl Hala, informed KTDC that it had been in discussion with the Kuwaiti company over the plans to sell the hotel.

“I would like to confirm that we have been approached by M.A Kharafi Group with regards to a possible sale of the Intercontinental Nairobi,” said Mr Hala, making a pitch for the Kuwaiti’s and recommending the deal to other shareholders of Kenya Hotel Properties Ltd.

“We believe that, given the profile of this investor, this is an opportunity worth exploring which may allow the current shareholders to maximise proceeds from their investment, ” he added.

In reply, Mr Kajumbi, in a letter dated June 4, aptly titled, “Proposed sale of shares,” said that the decision to sell the shares had the support of the board, pointing out that Treasury approval would have to be sought before any such sales.

Although it has suffered from long years of mismanagement and neglect, KTDC owns substantial assets and investments estimated to be worth KSh6 billion ($95.2 million).

Besides the equity it holds in the Hotel Intercontinental, it is the sole owner of KTDC Utalii Investments Ltd, Bomas of Kenya Ltd and has the majority shareholding in Mt Elgon Lodge Ltd, Sunset Hotel Ltd in Kisumu, Kabarnet Hotel Ltd and Kakamega Hotel Ltd.

In addition, KTDC owns 34 per cent of the shares in International Hotels Kenya Ltd that owns the famous Hilton Hotel in Nairobi.

Industry sources have expressed fear that – – if the Inter continental is sold – – it could open the floodgates and set the stage for a scramble for KTDC’s other valuable assets by well_connected oligarchs.

Indeed, the corporation’s assets remains badly exposed to influential individuals angling to buy state assets on the cheap.

Created in the 1960s when state_owned development finance institutions were viewed as critical to the development of the country, KTDC no longer commands much attention from policy makers.

One of its most_prized assets and highly lucrative assets, Buffalo Springs Lodge, is now under the control of private hands, having changed ownership in controversial circumstances.

Although officially KTDC still retains 41 per cent of the shares of Buffalo Springs, effective control of the lodge is now in the hands of Mara Simba Group of Lodges Ltd. KTDC’s assets have always been the soft target of interests angling to manipulate privatisation to obtain its assets on the cheap.

When in 2004, a group of British nationals with interests in the local tourism industry came up with a proposal to commercialise some of the operations of the Kenya Wildlife Service, it was not surprising that among the targets of the commercialisation plan were hotels owned by
KTDC.

We have also established that the schemers had also openly stated their intention to acquire KTDC’s Mombasa Beach Hotel, Voi and Ngulia lodges in another scheme mooted in 2004, and which could have also led to the privatisation of the Kenya Wildlife Service.

In a concept paper entitled The commercialisation of the Kenya Wildlife Service, the forces behind the idea of commercialising some of the activities suggested that private interests be allowed to own KTDC.

The document read in part; “That is why it is important to acquire KTDCâ€|not only does the Mombasa Beach Hotel complete the tourist circuit, Voi Lodge and Ngulia become available in Tsavo.” KTDC owns 63.40 per cent of the Kenya Safari Lodges and Hotels Ltd that runs the three tourist facilities.

When the government attempted last year to introduce the Tourism Bill 2007, whose centre_piece was a proposal to repeal the KTDC Act and to transfer its functions to a completely new entity, critics read an attempt to expose KTDC’s lucrative assets to buccaneers.

Drafted last year, the Bill had initially proposed to do away with several other public corporations in the Tourism Ministry. For instance, it had called for the establishment of the Kenya Tourism Authority, a body that would have been involved in setting standards, registering and licensing tourist facilities, and implementing government policies in the sector.

The Bill had also sought to replace KTDC with what was initially termed the Kenya Tourist Fund (KTF).

But mid_last year, several heads of public corporations in the Tourism Ministry came out fighting against the Bill by expressing strong opposition to it at a conference that had been called to debate it.

However, the Bill was to resurface early this year with some of the changes recommended by various stakeholders including the renaming of the KTF to the Kenya Tourism Development Fund.

But now, Mr Kajumbi says that the Ministry of Tourism shelved the Bill. “Following consultations with stakeholders it has been shelved as the Ministry of Tourism is looking at it in the light of Vision 2030 which gives the Kenya Tourist Development Corporation a key role to play.”

Mr Kajumbi also denied that KTDC, which was established in 1965, or is about to be wound up and replaced by the Kenya Tourist Development Fund. “KTDC was formed by an Act of Parliament, Cap 382 from which it derives its mandate,” he added.

He said the corporation was established to provide long_term financing and to provide business advisory services to investors.

Speaking to The East African, Mr Kajumbi denied knowledge that KTDC’s assets were about to be sold.

“KTDC has no intentions at the moment to divest from any of our subsidiaries or associated companies such as the Hilton or the Intercontinental Hotel or the Kenya Safari Lodges chain which includes Mombasa Beach Hotel, Voi Safari Lodge an d the Ngulia Safari Lodge.”

He further said that the corporation “is very operational, has not collapsed and still holds substantial investments in hotel establishments in the country which also include the Golf Hotel and Sunset Hotel.”

He said the corporation has a performance contract with the government and that – – as a state corporation – – it is mandated to manage public resources and account for results.

KTDC is one of the development finance institutions established in 1965 following the enactment of the KTDC Act, Cap 382 of the Laws of Kenya. It is meant to provide long_term financing for tourism development on concessionary terms.

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Date: Thu, 10 Jul 2008 08:19:37 +0300
From: Paul Nyandoto
Subject: Kenya is being sold in bits as we sleep: Let us wake up/intercontinental hotel on the line