South African investment manager African Infrastructure Investment Managers (AIIM) is considering acquiring a controlling position in Incorp Limited, which runs the grain and port businesses of Mombasa business magnate Mohamed Jaffer. This move is part of AIIM’s plan to increase its investments in African infrastructure, including logistics.
Incorp Limited’s principal companies include Bulkstream Limited and Grain Bulk Handlers Ltd (GBHL), which have historically led grain handling at Mombasa Port under Mohamed Jaffer.
Jaffer faced hurdles earlier this year when a Court of Appeal verdict removed GBHL’s 24-year port monopoly, allowing for the creation of a second-grain handling facility. This decision marks a significant shift in Kenya’s grain logistics business, raising competition and potentially altering service efficiency and costs for milling enterprises.
AIIM manages $2.8 billion in assets and operates in South Africa, Nigeria, Kenya, and Côte d’Ivoire, establishing itself as a leading participant in African infrastructure investment.
The company has a great track record, with eight infrastructure funds across various areas such as transportation, energy, and logistics. Its investment in Jaffer’s Incorp Limited demonstrates AIIM’s emphasis on high-growth infrastructure sectors, particularly in East Africa, where port operations and grain logistics are critical to regional trade.
These acquisition conversations follow GBHL’s announcement of a massive grain-handling terminal in Embakasi, Nairobi, over a year ago. The terminal was created to improve grain logistics from the coast to Kenya’s inland center, increasing efficiency for millers and manufacturers by lowering transportation costs and eliminating bottlenecks.
Despite recent issues at Mombasa Port, the Embakasi Grain Terminal establishes GBHL as a major participant in the grain handling sector, meeting Kenya’s expanding demand for efficient food supply chains.
For nearly 30 years, Mohamed Jaffer’s GBHL has dominated grain handling at Mombasa’s major port, which is an important nexus for East African trade. However, a recent court decision to expand the industry is expected to test GBHL’s market share. The addition of a second grain handler will increase competition, potentially enhancing service for millers and lowering consumer prices.
For AIIM, acquiring Incorp Limited is critical because major infrastructure investments are required to address escalating food security concerns and improve supply networks across Africa. A successful investment would pique AIIM’s interest in Kenya’s grain handling and port operations, cementing its status as a key infrastructure investor on the continent.
As AIIM examines Incorp’s operations, industry observers predict that its infrastructure knowledge will drive efficiencies and improvements in Kenya’s grain logistics. Jaffer believes that new capital and management insights will help him negotiate a more competitive market.
Kenya’s grain handling sector is at a tipping point, with AIIM’s possible engagement heralding new development and transformation prospects. Local and international parties are keeping a careful eye on these developments, as AIIM’s investment in Incorp signifies a larger shift in the management and development of African infrastructure assets to satisfy the continent’s needs.