This archive report was first published on 15 October 2021.
Published on October 15, 2021, a pioneering deal between Orbit Products Africa Limited (Opal) and GRIT Real Estate Income Group has brought in a cash sales price of $53.6m for Opal's manufacturing facilities in Kenya.
Opal, a contract manufacturer for Reckitt, Colgate-Palmolive, and Unilever, owned by brothers Sachen and Dirchen Chandaria, will continue to operate on the same site under a new 25-year lease, with an option for a further 10 years.
According to Sachen Chandaria, CEO of Orbit, 'At a time when finance is a strained issue everywhere in the world after the unprecedented economic shock delivered by the Covid-19 pandemic, and with our own East African banking system working hard to contain its risk through restructuring existing lending, 'sale and lease back' opens a new path to cash injections and finance for manufacturing expansion.'
GRIT Real Estate Income Group, a London Stock Exchange-listed company, has expanded rapidly across Africa, moving to the main list in January 2021. The group will upgrade and expand the Mombasa Road manufacturing facilities to provide factory and middle management space for an additional 100 employees, creating around 150 jobs during the construction phase.
The deal has attracted the interest of international financial institutions, with the IFC arm of the World Bank providing over half of the finance for GRIT to purchase the Opal facility, at $28.6m, while GRIT has raised another $25m with a corporate bond issue.
