Sun European Partners buys Ethiopian flower producer from KKR

Sun European Partners has reached an agreement with KKR to purchase a majority stake in Afriflora, an Ethiopian flower producer, for an undisclosed sum.

Headquartered in Aalsmeer, The Netherlands, and founded in 2005, Afriflora supplies 1.1 billion fair trade stem roses of more than 65 varieties annually, mostly to European customers under long-term supply contracts. The company employs 11,000 people and operates a total of 500 hectares spread across three flower farms in Ethiopia, one of which, located near Lake Ziway in central Ethiopia, is the world’s largest, according to the company.

“Afriflora is a world leader in an attractive sector that we know very well,” Sun managing director Paul Daccus said.

The company also highlighted its “significant experience making acquisitions in horticulture” and previous investment in Flamingo Horticulture, a vertically integrated flower and vegetable producer in Kenya. In addition, in October 2015, Sun purchased the flower and vegetable business of Finlays, a tea farmer, in a deal understood to be valued at £100 million ($154 million; €135 million).

Afriflora’s founding Barnhoorn family, which is to remain a “significant” shareholder in the company, will continue to run the business with a focus on contributing to local development efforts.

Institutional backing 

In April 2015, Afriflora received a €90 million investment from the International Finance Corporation designed to support a 60 percent expansion in production, which aimed to create an additional 5,000 jobs.

“Our company has for many years been committed to investing in the local marketplace and building a future not only for the business, but also for the workforce who have supported us through our growth and development, and this will not change,” said Afriflora chief executive Peter Barnhoorn.

According to Afriflora’s website, the population in the area surrounding its farm near Lake Ziwal has doubled to approximately 140,000 since the company began production there in 2005.

KKR described its investment in Afriflora, made in June 2014, as its first direct investment in Africa and a reflection of its long-term commitment to the region.