Kenyan firm buys Tanzanian drugs manufacturer

Posted on : Saturday , 15th October 2016

Catalyst Principal Partners, a Kenyan private equity firm, has bought a controlling stake in Tanzanian pharmaceutical company Zenufa Laboratories.

The acquisition of Zenufa is Catalyst’s fourth investment in Tanzania and second investment in the healthcare sector. In 2014, it acquired Kenya’s Mimosa Pharmacy, which was later rebranded Goodlife Pharmacy and has rolled out across the region.

The $125 million (Sh12.5 billion) private equity firm is making waves in the big boys’ investment club, which is currently dominated by players like Centum Investment, by pumping in millions of dollars into the region’s high-potential businesses.

Zenufa manufactures over-the-counter and prescription drugs for the Tanzanian market. Its brands include Zenadol, Zenkof, Zn-vital and Dr Cold.

“We are going to restructure Zenufa’s board and also bring in an expatriate as the new CEO. We are also going to change the way Zenufa approaches the market by working with the Tanzanian government to supply public hospitals with drugs. Previously, the company only supplied private pharmacies,” Catalyst Investment Manager Martha Osier said.

The main challenge Zenufa faced before Catalyst bought into it, Ms Osier said, was a poor marketing strategy and lack of capital. The company, however, has a fairly healthy balance sheet and is profitable.