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Woolworths Holdings’ H1 profit falls on Australia arm write-down

22 February 2018 Comments (0) Actualites, Africa, Australia, Business, Economy, Politics

JOHANNESBURG (Reuters) – South African retailer Woolworths Holdings Ltd posted a 15 percent fall in half-year profit on Thursday hurt by a hefty write-down charge on the value of its David Jones business in Australia and tough trading conditions in its home market and Australia.

Woolworths paid a big premium to bulk up in Australia via David Jones as part of Chief Executive Ion Moir’s ambitions to turn the firm into a leading southern hemisphere retailer, but the delayed execution of certain initiatives aimed at transforming David Jones is threatening that ambition.

“A challenging market, along with some mistakes in the implementation of new systems and ranges, has had an impact on our clothing businesses both in South Africa and Australia,” Moir said in a statement.

Australia has recorded soft retail sales growth for months as cut-throat competition, relentless price discounts and online competition sap demand for brick-and-mortar shopping.

While in South Africa retailers have struggled to grow earnings as weak economic growth and clothing markdowns by competitors hit sales.

Woolworths, which sells groceries, food and homeware, said headline earnings per share (HEPS) fell to 206.3 South African cents in the six months to Dec. 24, from 242.6 cents a year earlier, while earnings per share turned into a loss of 505.9 cents on the David Jones impairment.

Woolworths booked a non-cash impairment charge of A$712.5 million ($556.04 million) against the carrying value of David Jones as a result of the cyclical downturn and structural changes that have hurt performance across the Australian retail sector.

The retailer, which paid 21.4 billion rand ($1.84 billion) for David Jones in 2014, said the impact of these changes have been exacerbated by poor or delayed execution in certain key initiatives in David Jones.

David Jones sales were 3.3 percent lower on a comparable basis, while comparable store sales were 3.4 percent lower in Woolworths South Africa, hurt by underperformance in Woolworths Fashion, Beauty and Home.

The group declared an interim cash dividend of 108.5 cents, an 18.4 percent decrease on the prior period.

“Encouragingly, we are seeing signs of recovery now, with political change in South Africa expected to lead to increased consumer confidence,” Moir said.

South Africa’s new president, Cyril Ramaphosa, was sworn in as head of state last Thursday after his scandal-plagued predecessor Jacob Zuma resigned on orders of the ruling African National Congress.

 

($1 = 1.2814 Australian dollars)

($1 = 11.6563 rand)

 

(Reporting by Nqobile Dludla; Editing by Gopakumar Warrier)

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Sibanye-Stillwater falls into annual loss, closes dividend tap

22 February 2018 Comments (0) Actualites, Africa, Business, Economy, Health, Mining

JOHANNESBURG (Reuters) – South African-based gold and platinum producer Sibanye-Stillwater reported an attributable loss for 2017 and in a bid to preserve cash turned off the dividend flow that has made it a darling of investors

Sibanye’s share price fell 5 percent, underscoring disappointment among investors who have grown accustomed to hefty dividend payouts from the Gold Fields spin-off.

The company’s operations, including the troubled Rustenburg assets it acquired from Anglo American Platinum, delivered solid results, with the loss stemming from impairments, provisions for occupational healthcare claims, and restructuring and transaction costs among other factors.

Sibanye-Stillwater reported an attributable loss of 4.437 billion rand ($333 million) for the year ended 31 December 2017, compared with attributable earnings of 3.473 billion rand ($237 million) for the year ended 31 December 2016.

“In the near term, cash preservation is prudent and as a result no final dividend is being declared,” the company, which has given over 4 billion rand back to shareholders since 2013, said.

Sibanye initially positioned itself as a dividend play with cash flowing from mature South African gold assets that did not require huge investment, but it has been expanding into platinum and beyond South Africa, diverting its dividend flow.

Its dividend yield is now 2.882 percent, almost the same as the 2.84 percent for Johannesburg’s All-share index.

The healthcare provision has been put aside for an expected settlement in a class-action suit against six current and previous South African gold producers related to a fatal lung disease. This also hit AngloGold Ashanti’s earnings.

It was launched almost six years ago on behalf of miners suffering from silicosis, a fatal lung disease contacted by inhaling silica dust in gold mines, and is expected to be settled in a few months.

Overall, Sibanye’s operational performance was good, suggesting it will return to profits and dividends.

The company said its labour-intensive Rustenburg platinum operations west of Johannesburg – which under Amplats were loss-making and flashpoints of violent labour unrest – contributed 1.6 billion rand or 18 percent to group adjusted EBITDA.

“The Rustenburg operations have consistently delivered solid production and improved financial results, with approximately 1 billion rand in cost savings and synergies realised in the first year of incorporation, well ahead of initial expectations of 800 million rand over three to four years,” the company said.

“This is a remarkable result from assets which, before being part of the Sibanye-Stillwater Group, had been delivering significant and sustained losses for many years,” said chief executive Neal Froneman.

 

(Reporting by Ed Stoddard; Editing by Tiisetso Motsoeneng and Adrian Croft)

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Nigerian state oil firm spent $5.8 bln on fuel imports since late 2017

21 February 2018 Comments (0) Actualites, Africa, Business, Economy, Oil, Politics

ABUJA (Reuters) – Nigeria’s state oil firm said on Tuesday it had spent $5.8 billion on fuel imports since late 2017, as it combats a fuel shortage that has left people queuing for hours at filling stations and hobbled an already-struggling economy.

“The corporation’s intervention became necessary following the inability of the major and independent marketers to import the product because of the high landing cost which made cost recovery and profitability difficult,” the Nigerian National Petroleum Corporation (NNPC) said in a statement.

The price of gasoline is a highly charged subject in Nigeria, Africa’s largest oil exporter. President Muhammadu Buhari in 2016 raised the top gasoline price to 145 naira ($0.4603) per litre, a 67 percent hike, but did not remove a cap for fear of hurting people on low incomes.

The price cap makes it tough for many importers to profit from gasoline and NNPC has imported as much as 90 percent of the nation’s gasoline needs over the past year. Fuel shortages have gripped much of the country in the last few months.

An economic body that advises Nigeria’s government has been in discussion with the state oil company to determine whether gasoline is appropriately priced in the country, a state governor said last week.

The relatively cheaper cost of Nigerian fuel combined with crude oil price rises in the last few months mean smugglers can make more money selling fuel intended for the Nigerian market across borders, creating shortages in the West African giant.

Nigeria’s refining system means it is almost wholly reliant on imports for the 40 million litres per day of gasoline it consumes.

Efforts by Buhari’s predecessor, Goodluck Jonathan, to end expensive subsidies in 2012 led to riots in the streets because the move would have doubled gasoline prices, angering citizens who see cheap pump prices as the only benefit from living in an oil-rich country

(Reporting by Paul Carsten, editing by David Evans)

 

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11 Arab Companies Make Forbes Global 2000 Top Growth Champions List

15 December 2017 Comments (0) Business, Middle East

forbes

The world’s biggest and most powerful companies are ranked yearly by sales, profits, assets, and market value and ranked in the Forbes Global 2000. This year, Forbes worked with database company Statista to look at the compound annual growth rate of revenues, from 2013 to 2016, for all 2000 companies and converted figures into US dollars. The growth rates were then ranked, and the top 250 companies were listed as the Forbes Global 2000 Top Growth Champions.

While no Arab company made it into the top 250 companies that made the Best Employers, Top Regarded Companies, or Top Multinational Performers list, 11 Arab companies did leave their mark on the 250 Top Growth Champions list. Of the 11 companies, five are from Saudi Arabia, four are from the United Arab Emirates, two companies are from Qatar, and one is situated in Lebanon.

UAE Leads the Way

Heading the Top Growth Champions list is the UAE’s residential and commercial development company, Damac Properties. Situated in Dubai, the luxury real estate company delivers upscale properties across the Middle East and the United Kingdom. As of May 2017, Demac Properties had a market capitalization of $4.7 billion. It had total assets of $6.92 billion, and a gross debt of $1.36 billion. With 55 million square feet of property development in planning or progress, including more than 13,000 hotel rooms and more than 19,000 employees, Demac earned $1.63 billion at the end of Q3 2017, 13% higher than in 2016.

With Expo 2020 set to increase demand for real estate in the region, Demac’s performance was attributed to continued demand for its projects. Demac recently reported more than 80% of its hotel apartment projects in New Dubai and Dubai South have sold out. It runs the only Trump brand golf club in the Middle East, and the company has also been chosen by the Oman Government to develop its $1 billion Port Sultan Qaboos waterfront project. Although revenues fell slightly in 2016, the real estate market in the region has stabilized according to Demac’s CFO Adil Taqi, and sales for the first six months of 2017 are up 4% over the same period in 2016.

Top Growth Middle Eastern Companies

The other Middle Eastern companies that made the list included Saudi owned real estate firm Jabal Omar Development, which ranked number 7. Alinma Bank, also from Saudi Arabia ranked 167th, Alawwal Bank ranked 169th, Saudi Investment Bank ranked 210th, and Saudi Arabian Mining Company came in at 222nd. Other companies from the UAE included real estate and construction firm Emaar Properties, which ranked 208th, and Dubai Islamic Bank, which ranked 249th. Qatar National Bank ranked 96th and Qatari real estate and construction company Ezdan Holding Group ranked 157th. Bank Audi from Lebanon came in at number 155.  

Top Five Global Companies

Ranked second on the list is China’s largest auto distributor China Grand Automotive Services. The Shanghai based company sells more than 50 different brands of cars, including Chrysler and Mercedes-Benz. In 2016, the firm posted revenues of $20.6 billion, 45% higher than the previous year. Also from China is real estate development company, Greenland Holdings, which ranked 3rd, and Hong Kong gaming and real estate firm Melco International, which ranked 4th. Ranking 5th was Chinese delivery service company, S.F Holdings.

The top delivering US companies on the list were e-commerce company XPO Logistics, which was ranked 8th and New Residential Investment (13th), Cheniere Energy (21st), Vereit (34th) and Liberty Expeida Holdings, which ranked 34th.    

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Morocco announces auto industry deals worth $1.45 bln

12 December 2017 Comments (0) Actualites, Africa, Business

RABAT (Reuters) – Morocco said on Monday it had signed deals for 26 auto industry projects worth a total of 1.23 billion euros ($1.45 billion) as it seeks to build its position as an international hub for the sector.

The deals include six agreements with French company Renault to expand an “industry ecosystem” allowing the firm to increase local sourcing of car components to 55 percent, according to a government statement.

Renault has a large factory in the northern Moroccan city of Tangiers that opened in 2012, and an older assembly plant in Casablanca.

Another 13 of the new projects are planned as part of a manufacturing hub linked to a PSA Peugeot Citroen factory under construction in Kenitra, north of the capital, Rabat.

That plant is due to open in 2019 and initially produce 90,000 vehicles a year.

The projects announced on Monday are with companies from France, Spain, Italy, China, South Korea, Japan and the United States, and are expected to create more than 11,500 jobs, the government statement said.

Eleven of the companies will be operating in Morocco for the first time, Abdel Wahid Rahal, a senior official at the ministry for industry, investment, trade and digital economy, told Reuters.

On Saturday, officials announced a memorandum of understanding with Chinese automaker BYD to build an electric car plant near Tangier that is expected to create 2,500 jobs. They gave no details on the value of the deal.

Unlike many countries in the region, Morocco has avoided a big drop in foreign investment following the global financial crisis and the Arab Spring uprisings of 2011, partly by marketing itself as an export base for Europe, the Middle East and Africa.

The kingdom has attracted a number of big auto and aerospace investors in recent years.

 

($1 = 0.8495 euros)

 

(Reporting by Zakia Abdennebi; Writing by Aidan Lewis; Editing by Peter Cooney)

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Steinhoff accounting irregularities trigger share crash, CEO exit

6 December 2017 Comments (0) Actualites, Africa, Business

JOHANNESBURG (Reuters) – Steinhoff International shares crashed on Wednesday after it revealed accounting irregularities and its CEO quit, shocking investors who had backed the rapid reinvention of a South African furniture chain into an international retail empire.

The company said late on Tuesday that “new information has come to light today which relates to accounting irregularities requiring further investigation” and that billionaire Christo Wiese, its largest shareholder and chairman, would take charge.

Steinhoff said chief executive Markus Jooste, who had been at the helm for nearly 20 years and oversaw its expansion to one of the world’s largest household goods retailers, had resigned with immediate effect and consultants PwC would undertake an “independent investigation”.

Steinhoff has been aggressively expanding in developed markets since moving its primary share listing from Johannesburg to Frankfurt in 2015, snapping up Britain’s Poundland, U.S-based Mattress Firm and Australia’s Fantastic.

Steinhoff said Wiese would “embark on a detailed review of all aspects of the company’s business with a view to maximising shareholder value”, but its South African shares slumped 65 percent to an eight-year low of 15.87 by 1120 GMT. Its stock was down in Frankfurt by 66 percent following the news.

Steinhoff has been under investigation for suspected accounting irregularities by the state prosecutor in Oldenburg, Germany since 2015. Steinhoff has said that was a tax case relating to whether revenues were booked correctly, and taxable profit correctly declared.

Reuters reported last month that Steinhoff did not tell investors about almost $1 billion in transactions with a related company, despite laws that some experts believe require it to do so.

It is unclear what accounting irregularities the company was referring to in its statement on Wednesday. A spokesman declined further comment and attempts by Reuters to contact Jooste were not successful.

The development had wider repurcussions too, with the chief executive of Steinhoff African Retail (STAR), part of Steinhoff which includes the control of Shoprite, also resigning on Wednesday and its shares falling 21.5 percent to 19.30 rand by 0855 GMT.

“In light of these developments at Steinhoff, STAR’s existing CEO, Ben la Grange has decided to step down as CEO of STAR,” the company said.

 

TAX RATE QUESTIONS

Analysts have long questioned how Steinhoff managed to achieve such a low tax rate. Its tax rate has averaged 12 percent over the past five years — half the headline corporate tax rate in its main markets and less than half the rates paid by listed competitors including France’s Casino, Germany’s Metro AG and South Africa’s Woolworths.

Experts say such low tax rates can be the result of complex corporate structures which stretch accounting rules and such arrangements are occasionally challenged by courts as unlawful.

“The company recorded a very unusual tax rate of c. 15 percent and also guided that this would be the rate going forward,” Juergen Kolb, an analyst at Kepler Cheuvreux, said in a note, adding that if this tax rate was at risk it could also hit Steinhoff’s cashflow.

Kolb also raised the possibility that as chairman, Wiese’s role could now come under scrutiny too.

Steinhoff did not respond to requests for information about what, if anything, Wiese knew about the accounting problems now being investigated before Tuesday.

Investors also told Reuters they are concerned Wiese may be forced to sell shares he bought last year with borrowed money.

Wiese borrowed 1.6 billion euros ($1.9 billion) to buy additional Steinhoff shares through a family trust in September 2016, pledging 3.2 billion euros of his existing holding as security to the investment banks that lent the money.

With the share price plunge taking the security below the value of the loan, Wiese may be required by the financing banks — Citi, Goldman, HSBC and Nomura — to post more shares as collateral, or sell part of his holding.

($1 = 0.8459 euros)

 

(By TJ Strydom. Reporting by TJ Strydom; additional reporting by Tanisha Heiberg, Tom Bergin and Alasdair Pal; writing by Alexander Smith; editing by Tom Pfeiffer and Keith Weir)

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Heineken to open $100 mln brewery in Mozambique in 2019

4 December 2017 Comments (0) Actualites, Africa, Business

JOHANNESBURG (Reuters) – Heineken will open a $100 million brewery in Mozambique, its first production facility in the southern African nation, the brewer said on Monday.

The world’s second-largest brewer plans to start production at the 0.8 million hectoliters capacity plant in the capital Maputo in the first half of 2019, it said in a statement.

Heineken, which also brews Amstel and Sagres, opened a marketing office in Mozambique last year, importing products to compete in a market where AB Inbev’s 2M is entrenched.

AB Inbev last year took over SABMiller, gaining a brewery in Mozambique among a host of assets worldwide.

“We are delighted to enter Mozambique, where we see promising long-term economic perspectives,” said Heineken’s managing director for East and West Africa Boudewijn Haarsma.

Heineken built a brewery in neighbouring South Africa less than a decade ago after ending a deal with SABMiller for brewing Amstel beer.

 

(Reporting by TJ Strydom; Editing by James Macharia and David Evans)

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Africa’s first online shopping mall looks to make its mark

25 April 2017 Comments (0) Business, Featured, Technology

Online shopping is big business across much of the world, but in Africa e-commerce has yet to make the sort of impact that other technologies, such as cell phones, have done. However, the online retailer, Odjala, is Africa’s first online shopping mall, and it hopes to capitalize on the ever increasing access the continent has to smartphones and the internet.

The spread of e-commerce

While most African consumers still visit bricks & mortar stores or markets to make a purchase, the market for online retail in Europe and North America is huge. The man behind Odjala, Afiss Bileoma, mentioned that 60% of people in Europe and North America use online shopping to make purchases. The company E-marketer, states that Africa only accounts for 2% of online purchases worldwide, but this is a situation that is already changing and likely to change even more as time goes on.

Internet penetration is around 20% in Africa now, and smartphones are rapidly spreading along the path that cellphones already trod.

This embracing of technology has already led to large online retailers such as Nigeria’s Jumia, which has sites in 23 different African countries. However, the Benin based Odjala will be the first to offer a virtual mall online, and it will be offering consumers the chance to buy a wide range of products.

Bileoma states, “We turn around 10,000 Internet users a day, 20% of which will go through with a purchase. They buy a lot of gifts, clothes, toys. We succeeded a big blow by signing a partnership with Naomi Dolls; dolls that were only available in Côte d’Ivoire or France.”

In addition to offering exclusive products such as Naomi Dolls, Odjala’s main role is in providing an online presence to Benin’s largest outdoor market. The market is called Dantokpa, and is situated in the Cotonou area of the nation. Dantokpa hosts numerous independent shops and stands, yet most of its stock is now available on Odjala’s online mall which allows Benin’s consumers to peruse the extensive range of goods from their own homes.

Outdoor meets online

It would initially seem that an outdoor market is the antithesis of online shopping, but Odjala has sought to connect the traditional way that most Beninese shop, with the growing demand for online services. Odjala means “Big Market” in the local language of Yoruba, and the Odjala app is free to download on both Android and Apple products. Bileoma set up Odjala in 2016, and secured agreements with the majority of Dantokpa’s stores, and additionally made deals with other retailers in the area.

A consumer can use either the app or visit the online mall directly on their computer; any order that is placed is then delivered to their door by a courier. Bileoma accepts that this relatively new concept will take time to grow, as many potential customers have to get used to shopping in such a different way. Bileoma has promoted the concept on social media sites, such as Facebook, but still encountered a lot of customers who he said would “call and who actually wish to see the stalls.”

Nevertheless, such problems can often be overcome by providing customers with a sense of security that lessens concerns they may have over a new service. Bileoma explained that, “If a customer is not satisfied by a product, he can return it.”

This policy is fairly standard for online retailers around the world, but one of Odjala’s other features is a lot less common. Around 90% of purchases made on Odjala are paid for by the customer upon delivery. This model would be highly unusual for most online retailers, and is more akin to the method used by auction sites like Ebay.

However, these types of reassurances could help ensure that people new to online retail, feel more confident about trying a new method of shopping. It is online shopping with an understanding of how the majority of consumers in Benin are used to spending their money, and Bileoma will be hoping that such things build confidence in his brand.

As online shopping saves customers’ time, and the money that would be spent on traveling to a store, Odjala looks set to make the most of the ongoing spread in Africa’s online presence.

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Israeli start-ups raise a record $4.8 billion in 2016

19 April 2017 Comments (0) Business, Featured, Technology

Overall, last year was a successful one for Israeli start-ups, raising a record breaking $4.8 billion in funding, according to a recent survey by the Israel Venture Capital (IVC) Research Center and law firm Zysman Aharoni, Gayer & Co. (ZAG). The increase is of 11% from the year before, when Israeli high-tech companies raised $4.3 billion. The report also stated that the average financing round, which has been steadily growing over the past five years, reached $7.2 million last year, 19% above the $5.1 million five year average. However, the last quarter of 2016 saw a drop of 8% compared to the last quarter of 2015.

IVC CEO, Koby Simana explained in a statement, that 2016 was a record breaking year for Israeli start-ups, but despite the higher total amount, it was characterized by a smaller number of financing rounds, with higher average capital raised each round. “This is a troubling trend for the Israeli VC funnel, since the majority of capital goes into later rounds.” Simana said. “If there are no companies lined up for later investments, there could be a more serious issue later on.”

Fewer financing rounds

While capital-raising reached new heights, the survey found the number of financing rounds were much fewer than expected. There were 659 deals closed in 2016, which is only marginally above the average of 657 deals closed per year. It was also 7% lower than 2015’s record high of 706 deals closed throughout the year.

The IVC – ZAG report also found an upsurge in large deals (above $20 million) in 2016. Both in terms of deal numbers and capital raised. There were 76 large deals during the year and $2.68 billion of capital raised. An increase of 22% from 2015 where 76 deals closed and $2.19 billion was raised. The increase in large deals is due to the enhanced activity of foreign investors, primarily corporate investors and venture capital funds, explained Simana.

Software companies raise most capital

 Software companies led the capital raising again last year, with $1.7 billion in funding, up from $1.4 billion in 2015, which also placed them first. Internet capital decreased, attracting a mere 16% of total capital, or $744 million, compared to 2015’s $1.12 billion, when it placed second with a 26% share. Life science capital raising also decreased in 2016, by 14%. However, the outlook for life science capital is still positive, according to Shmulik Zysman from ZAG. The industry still has potential in Israel, he explained, due to three reasons: the interest shown by Chinese investors, good chances of European and US investors returning to Israel and Donald Trump’s campaign to ease price control on medical services and drugs.

An optimistic outlook for 2017

 According to Forbes, Israel continues to attract the attention of top global funds looking for great deals outside of Silicon Valley, Boston and New York City. As well as large corporates interested in the innovation coming out of Israel, Chinese investors will continue to be a major influence. Forbes also put the decline of exits (initial public offerings and merger and acquisition deals) down to a growing maturity of the tech ecosystem in Israel. Regarding the findings in the report, Zysman remained cautious for the year ahead. “We expect the uptrend in capital raising activity to continue in 2017,” he said in a statement. “Though possibly at slower rates.”

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Kenya’s ride hail market shows African businesses adapting to global trends

8 December 2016 Comments (0) Africa, Business, Featured, Technology

When Uber took its taxi app to Kenya in 2015, the response was mixed as it has been in most markets. While many people embraced the service, others felt it undermined local taxi cab operators, and there were protests against the US Company.

However, over the course of its time in Africa, Uber has actually led to African businesses adapting to what it offers, and in Kenya a domestic rival app is already proving highly successful.

A Kenyan response to globalization

When globalization brings a new product to an emerging market, the response from locals is always likely to be mixed. Just as some will be delighted to share in a popular aspect from a developed nation, others will be concerned about the impact upon local culture and businesses. With a service like Uber there is clearly no concern over an erosion of local culture, but there are serious issues around how it affects local businesses. The same worries around exploitation of drivers that have captured headlines in the US and Europe have been replicated in Kenya, along with a worry that local taxi firms will be driven out of business.

In fact, earlier this year, the United Kenya Taxi Organization demanded that Kenya’s government banned Uber from the East African nation. While this did not happen Kenyan business has spawned a domestic rival. The upshot of this rivalry is that Uber has had to diversify what it offers to customers in an attempt to stay ahead of the game.

The local rival is called Little Cab, and it was launched in July this year by the Kenyan telecommunications giant Safaricom in conjunction with software firm, Craft Silicon. Evidently this is not a story of a small startup fighting a global brand, but nevertheless it is an African company ensuring market competition. Little Cab immediately set out to quell concerns over driver wages by announcing that it would only take 15% of drivers’ earnings, compared with Uber’s standard rate of 25%.

Little Cab did not end its points of differentiation there though; it also ensured that it provided free Wi-Fi in its cars, cheaper prices, and the option for female customers to request a female driver. Not only has Little Cab proved popular with consumers, it has forced Uber to alter its standard model and try to offer more to the Kenyan public. Within months of Little Cab’s launch, Uber slashed its Kenyan prices by 35%, a move that obviously benefits the taxi using people of the country.

Little Cab also allows users to pay in cash, and due to the scope of Safaricom’s telecommunications network, the service can also be used by people without a smartphone. A simple SMS can order a taxi with Little Cab, opening up the market – to an even wider number of potential users – as around 50% of Kenyan cellphone owners do not have a smartphone yet.

Moving Forward

As Little Cab continues to grow, it is likely to fuel even greater innovation from its rival, which should mean a better service for the customers. The former national minister of technology and information, and a professor of entrepreneurship at the University of Nairobi, Bitange Ndemo, highlighted the appeal of Wi-Fi in Little Cab’s cars and spoke of the rivalry with Uber saying,

“Both of them will have to look at what they are offering with bundled services in their vehicle.”

Uber claims that since its launch in Kenya, over 1 million trips have been taken by Kenyans, and that in Nairobi the service gets more than 100,000 hits a month. This is a figure that Little Cab strongly believes it will match, as Craft Silicon CEO, Kamal Budhabhatti, said that, “Little Cab aims to achieve one million rides in the next six months by entrenching and differentiating ourselves as a homegrown taxi app.”

In August of this year, drivers formed the Kenyan Digitial Taxi Association to lobby for worker rights and better pay deals. Drivers now have more leverage as they are able to simply move to a rival company if they feel the benefits are greater.

As competition for ride hailing services in Kenya steps up, if Uber want to avoid being overtaken by African innovation, they will have to work to the famous idea of “Think globally, act locally”.

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