Isuzu Motors is set to acquire 57.7 percent of General Motors East Africa (GMEA) stocks to become a subsidiary of Isuzu Motors.
This follows a buy out agreement reached with General Motors Company, GMEA’s parent company.
As the result, GMEA’s company name will be renewed in April this year and the new company will be known as Isuzu East Africa.
According to the new structure, the other shareholders will be ICDC:20 per cent, Centum Investments:17.8 percent and Itochu Corporation:4.5 per cent.
GMEA Managing Director Rita Kavashe (pictured) has been retained and will head the new company in a similar capacity.
“Isuzu is making this investment with the intention of expanding its commercial vehicle production and sales in Eastern Africa,” a statement from the Japan-based company said.
Since its establishment in 1975, GMEA has been engaged in assembly and sales of Isuzu-badged light and mid-duty trucks and buses, and import and sales of Isuzu pickup trucks and Chevrolet passenger cars. GMEA has maintained the top share in Kenya’s commercial vehicle market for five years since 2012.
“Isuzu will make this investment aiming at further quality improvement, vehicle sales expansion and aftersales service enhancement. For these purposes, Isuzu will provide the company in East Africa with as much assistance as possible in the fields of personnel training, manufacturing technique and enhancement of Aftersales business,” read the statement.
Reports that the company could decide to enter the market under its own name and take over GM operations in the region first emerged in 2014 but GM management dismissed them as “speculative and untrue.”
At the time, there were growing concerns that GM was fast losing the market to Toyota.
IEA’s sphere of business will be CKD kits-based assembly and sales of Isuzu trucks and buses, import and sales of Isuzu pickup trucks, parts supply and after-sales servicing.