Moringa School, which is popular among Kenya’s growing developer community has found itself in somewhat hot soup after the Competition Authority of Kenya (CAK) went after it for an illegal buyout.
The multi-disciplinary coding, technical and professional training institution has been fined Kes.503,656 for a buyout deal that happened back in 2016. The CAK accuses Moringa School of changing its ownership without notifying the authority or even seeking approval for the transaction.
The details are, Moringa School, which has operations in Hong Kong, Pakistan and Ghana but headquartered in Kenya was initially owned by two individuals, Audrey Patricia Cheng and Frank Collins Tamre, as a joint venture.
In 2016, Ms Cheng bought off Mr Tamre’s shares, which changed the particulars of the ownership from joint to a sole proprietorship.
This move is what the CAK has termed as illegal as it was not notified neither did it give approval for the same.
“The Authority engaged the two parties and, upon interrogating the relevant documentation, confirmed that the merger had been implemented without approval,” reads CAK’s statement. “The parties acknowledged having contravened the law. It is worth noting that administrative penalties take into account deterrence and proportionality of the infringement.”
Reports indicate that the Competition Authority got wind of the merger after the institution voluntarily admitted to going ahead with the buyout transaction without proper regulatory approval.
Moringa School has already paid the fine and the transaction has now been approved by the CAK terming that the buyout was unlikely to have any negative effect on competition in the education sub-sector of technology coding.