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Key Points
- Sameer Africa finalized all documentation in a $7.1 million land sale delayed by Kenya’s digital land registry transition, unlocking critical funds to retire debt and strengthen its balance sheet.
- The Merali family-led firm posted its highest profit in 11 years as foreign exchange gains and lower finance costs offset weaker tire and automotive product revenues.
- Sameer Africa’s assets rose 16.1 percent to $9.1 million in 2024, while shareholder equity surged 56 percent, signaling a stronger financial footing for future growth.
Sameer Africa, the Nairobi-based tire manufacturer majority-owned by the influential Merali family, has finalized all necessary documentation in the sale of a 3.75-acre parcel of land valued at over $7 million after a three-year delay caused by regulatory hurdles. This marks a milestone in the company’s strategy to retire a portion of its debt and stabilize its balance sheet.
Sale unlocks liquidity amid persistent debt pressures
The Nairobi Securities Exchange-listed firm disclosed that the land, historically carried on its books at Ksh15 million ($108,000), was sold for Ksh921 million ($7.11 million), providing a significant cash injection. Proceeds will be used to reduce outstanding liabilities, which had surged to Ksh857.4 million ($5.98 million) by June 2023, up from Ksh782.5 million ($5.46 million) six months earlier.
The sale had been stalled since 2021 due to a transition by Kenya’s Ministry of Lands to the Ardhisasa online platform, which delayed registration and final approvals. Management expects the completion to deliver meaningful savings on finance costs and reduce exposure to foreign exchange losses, which have weighed on performance in prior years.
Sameer Africa’s broader real estate portfolio, acquired decades ago, has seen substantial appreciation. In 2022, the fair value of its land and commercial properties was assessed at Ksh7.58 billion ($54.6 million), dwarfing the firm’s market capitalization of Ksh662 million ($4.8 million) at the time.
Profit surges despite sluggish revenue
For the year ended December 2024, Sameer Africa posted its highest profit in over a decade, buoyed by unrealized foreign exchange gains as the Kenyan shilling strengthened against the U.S. dollar. Net profit jumped 460.83 percent to Ksh259.89 million ($2.01 million), up from Ksh46.34 million ($0.36 million) a year earlier.
Despite a marginal 0.26 percent decline in revenue to Ksh389.5 million ($3 million), gross profit held firm at Ksh373.5 million ($2.88 million). A sharp turnaround in net finance income—from a loss of Ksh140.8 million ($1.09 million) to a gain of Ksh68.8 million ($0.53 million)—further strengthened the bottom line amid a significant recovery.
Merali family steers turnaround and asset monetization
Sameer Africa’s resurgence has been spearheaded by the Merali family, who control 74 percent of the business and have leveraged their deep industry networks and experience to guide the firm through years of operational challenges.
Based in Nairobi, the company manufactures and distributes tires under its flagship Yana brand and earns recurring income from leasing its expansive real estate holdings. As of the end of 2024, Sameer Africa reported total assets of Ksh1.18 billion ($9.11 million), a 16.1 percent increase, while shareholder equity surged 56 percent to Ksh736 million ($5.68 million). This landmark land divestment is the first major asset sale by the firm in recent years and underscores Sameer Africa’s focus on deleveraging and repositioning for sustainable growth.
