CORPORATE DEAL

CAK fines Moringa School Sh0.5M for undisclosed merger

Moringa is a multi-disciplinary coding school established in 2014

In Summary
  • The Nairobi headquartered institution has presence in Hong Kong, Pakistan, and Ghana
  • Moringa School and founder Audrey Patricia Cheng implemented a merger in 2016 without receiving the requisite regulatory approval
The Python coding workshop hosted by Moringa School on February 9, 2019. / COURTESY
The Python coding workshop hosted by Moringa School on February 9, 2019. / COURTESY

The Competition Authority of Kenya (CAK) has fined Moringa School Limited Sh 503,656 fine for implementing a non approved merger.

Moringa School and Audrey Patricia Cheng voluntarily informed the authority that they had implemented a merger in 2016 ,without receiving the requisite regulatory approval.

 The parties have paid the penalty and the transaction has been regularized by the Authority.

Moringa School was initially owned by Frank Collins Tamre and Audrey Patricia Cheng. Each of them owned 50 per cent of the business.

 

The change of ownership, from joint to sole, happened after Cheng acquired Tamre's stake in 2016. This transaction was done without approval from the Competition Authority of Kenya.

Located along Ngong Road, Moringa is a multi-disciplinary coding school offering technical and professional training.

The Nairobi headquartered institution has presence in Hong Kong, Pakistan, and Ghana.

“The authority engaged the two parties and, upon interrogating the relevant documentation, confirmed that the merger had been implemented without approval,” CAK said in a statement yesterday.

The transaction involved an acquisition of an additional 50 per cent shareholding in Moringa School by Cheng, resulting in a change from joint to sole control.

The transaction qualified as a merger within the meaning of Section 41(2) (a) of the Act and was therefore notifiable, the competition watchdog said. 

The section states: “No person, either individually or jointly or in concert with any person, may implement a proposed merger to which this part applies unless this merger is approved by the Authority.”

CAK has noted that the change of ownership was unlikely to have had a negative effect of competition in the education sub-sector of technology coding.

The transaction resulted in positive public interest benefits including offering education to over 1,000 students learning various coding technology such as Java, Spark, Django, Flask, among others, the authority has noted.

The school provides employment to almost 100 persons.

Established by Cheng in 2014, the school seeks to help prepare qualified employees and experts for the technology market by feeding them with updated tech content and skills.