Olyana Holding, an American liability company has signed a share sale agreement with the government of Rwanda for the acquisition of 60 percent shares in the Gisovu Tea factory and plantation according to foreign press reports.
The agreement follows cabinet approval of the sale of the tea factory.
According to the details of the deal, the American consortium represented by businessman George Rubagunya parted with $2.4m (Rwf1.3b).
Government through Rwanda Tea Authority (Ocir-The) retains 30 percent shares in the Kibuye-based factory while local farmers will maintain 10 percent.
Gisovu has a tea processing factory producing around 1.7m Kgs of tea annually.
Olyana’s acquisition of the controlling stake in Gisovu Tea Company is on a long term basis with the objective of developing its plantation, manufacturing and marketing activities.
The deal is also aimed at making Gisovu tea globally competitive through the implementation of Gisovu Business Plan as envisaged in the share sale agreement.
Oryana will be obliged to grow tea on the core plantation and also buy from outside growers.
It is said that Olyana will explore possibilities of processing and marketing of teas of Gisovu Tea Company by value addition in collaboration with the Government of Rwanda.
Government of Rwanda is pulling out of tea factories in order to increase competitiveness in the sector and increase the processing capacity of the factory while retaining the high quality of Rwanda’s tea.
Rwanda is also selling off 45 percent and 60 percent stake in Gisakura and Kitabi tea companies respectively.
“Government thought the factories can be managed better in the hands of the private sector,” Anthony Butera, Director General of OCIR-The said recently.