Finlays, a leading global supplier of tea, coffee and botanical ingredients and solutions, has reached an agreement to sell its James Finlay Kenya tea estates business to Browns Investments PLC.
The sale, which will be completed over the coming months, will include all parts of James Finlay Kenya Ltd except the Saosa tea extraction facility. Saosa will remain under Finlays’ ownership and the business will continue to source leaf tea, timber and other services directly from James Finlay Kenya, meaning an uninterrupted service to existing customers.
Browns Investments PLC was selected as the approved buyer because of its strong legacy of guiding its tea estates to continued growth, but also its focus on doing so sustainably while supporting its workforce and local communities.
Browns is a highly successful diversified conglomerate and part of the LOLC Holdings PLC group companies which is one of the largest and most profitable listed corporation in Sri Lanka. Headquartered in Colombo, the company has a proud heritage in operating plantation businesses, owning Maturata Plantations, Hapugastenne Plantations PLC, and Udapussellawa Plantations PLC. It is one of the largest tea producing companies in Sri Lanka consisting of 49 individual estates that stretch across an area of over 30,000 hectares and employs over 10,000 individuals.
James Finlay Kenya is Brown’s first investment in the Kenyan tea industry which it sees as an exciting opportunity for growth. In December 2021, Browns acquired Finlays’ Sri Lankan tea estates business, which has gone from strength to strength, demonstrating Browns’ successful commitment to sustainable growth.
Throughout the sale process Finlays has at all times prioritised the interests of James Finlay Kenya as a business and its workers. As part of the sale agreement, Browns and Finlays have mutually agreed to acknowledge the long-standing support of the local community by selling 15% of shares in James Finlay Kenya to a locally-owned co-operative. Finlays has identified a preferred third party which it is currently in discussions with.
While the sale process is concluded, operations for James Finlay Kenya will be business as usual, and a full plan is under development to ensure a smooth transition with no customer disruption. On completion of the sale, Browns intends to continue to run the business as it has been operated until now, as a leading global supplier of Kenyan tea, under a new name. There will be no change in the employment arrangements for current employees of James Finlay Kenya.
Finlays has a long heritage in owning tea estates, however after a strategic review in 2022, it decided that a new strategic investor in James Finlay Kenya would continue to guide this unique business towards long-term sustainable growth for the benefit of the whole community and the Kenyan economy at large.
Leaf tea will continue to be a critical part of Finlays’ portfolio, in which it has a strong global presence across the UK, Sri Lanka, Dubai, Kenya, Argentina, the US and China. As a business, Finlays has also decided to place greater emphasis on growing its tea and coffee extracts business which it sees as offering particularly exciting growth opportunities for its global customers.
Finlays has a long history in Kenya, and is continuing to invest in the country through its continued ownership of the Saosa tea extracts facility, and its tea sourcing and packing operations in Mombasa.
Kamantha Amarasekera, Director of Browns Investments PLC said: “We’re proud to be moving a business with such a proud heritage into a new phase of sustainable growth. James Finlay Kenya is an incredible business powered by an incredible community and it has an exciting future. We warmly welcome all members of the James Finlay Kenya team into the Browns family.”
James Woodrow, Group Managing Director of Finlays said: “We undertook a rigorous process when identifying a buyer for this unique business, prioritising what was best for James Finlay Kenya and its community. Having seen first-hand Browns’ unwavering focus on supporting local people and their communities to thrive when acquiring Finlays Sri Lankan tea estates business in 2021, we have no doubt that Browns is the ideal strategic investor for James Finlay Kenya. We will continue to have a very close relationship with James Finlay Kenya and look forward to continuing to source tea from it and championing Kenyan tea and botanicals across the world.”
Please direct media enquiries to media@finlays.net
Frequently Asked Questions
- About Finlays
Finlays is a leading global supplier of tea, coffee and botanical ingredients and solutions. Headquartered in London, UK, Finlays has extensive operations across four continents and offers unparalleled experience and expertise to unleash the potential of natural beverages for global brand owners.
- About James Finlay Kenya
James Finlay Kenya is a leading grower, manufacturer and supplier of Kenyan tea. It covers a total self-contained area of 10,300 hectares, including 5,200 hectares of tea fields over nine gardens and offers a wide-ranging portfolio of teas from Black CTC through to Orthodox, Steamed Green teas, Purple and White Tips.
- Why is Finlays selling JFK?
The decision to seek a new investor for James Finlay Kenya goes back to early 2022 when Finlays refreshed its global strategy to place a greater emphasis on growing its tea and coffee extracts business. Finlays has a long heritage in owning tea estates, and leaf tea will continue to be a critical part of our portfolio. However, as a business, Finlays’ has also decided to place greater emphasis on growing its extracts business which it sees as offering particularly exciting growth opportunities for our global customers.
- Will the sale affect JFK employees?
The strong sense of community is one of the key reasons Browns has decided to invest in JFK, and recognises that this is critical to the estate’s ongoing success. Once Browns takes ownership, it intends to run JFK as it has been operated until now – as a leading supplier of Kenyan tea. Browns is a strategic investor with extensive experience in operating large tea estate businesses.
- Tell us more about Browns Investments PLC and why they are a good fit for JFK?
The interests of everyone at JFK remain our top priority. We know Browns very well having previously sold our Sri Lanka Tea Estates business to them in 2021. Since then, we’ve seen first-hand how its commitment to sustainable growth and employee welfare has seen the Sri Lankan Tea Estates go from strength to strength. Browns’ extensive experience of owning and driving growth in plantation businesses, as well as its focus on sustainability, workers and local communities – demonstrated by the joint decision to transfer a 15% stake in JFK to a locally-owned co-operative – makes it the ideal strategic investor.
- How will the 15% transfer to community ownership work?
As part of the sale agreement, Browns and Finlays have mutually agreed to acknowledge the long-standing support of the local community by selling 15% of shares in James Finlay Kenya to a locally-owned co-operative. We have identified a preferred third party who we are in discussions with about this.
James Finlay Kenya has strong track record in sharing ownership of JFK to the local community. In 2012, JFK sold 10% of its operations as a going concern to Kipsigis Highland Co-operative Society which now has 70,000 direct and indirect shareholders across Kericho and Bomet counties.
- What is happening to Finlays Botanicals business which is located at JFK?
Finlays Botanicals supplies traceable and sustainably sourced botanicals to global customers. Finlays Botanicals is included in the sale to Browns.
- What is happening to Saosa, Finlays tea extracts facility located at JFK?
The Saosa tea extracts facility remains a key part of Finlays global tea extracts infrastructure. At the moment, Saosa is part of James Finlay Kenya. Over the next few months we will be taking the steps necessary to move Saosa into a new company that will continue to be wholly owned and operated by Finlays in Kericho.
- What does the sale of JFK mean for Finlays customers who purchase products from JFK?
After the sale is complete, Finlays will continue to supply leaf tea grown and manufactured at James Finlay Kenya, and all existing contracts will be honoured by Finlays. This means that Finlays will continue to provide an uninterrupted service to customers. Customers who receive tea extracts from Saosa will continue to purchase as normal, and Saosa will remain part of Finlays.
- Is Finlays still committed to Kenya?
Absolutely. Finlays has a long heritage in Kenya and is continuing to invest in the country through our continued ownership of the Saosa tea extracts facility, and our tea packing operations in Mombasa.
- Is the sale happening because of the recent BBC documentary? Will you continue to deliver the action plan to remediate the issues highlighted?
In 2022, Finlays made a strategic decision to start seeking new ownership for JFK. The BBC documentary, which was broadcasted on 20th February 2023 had no impact on this decision.
The testimonies from workers across Kenyan tea estates shared in the documentary were deeply upsetting – there is simply no place for harassment, abuse or misconduct of any kind at JFK. Finlays has focused on taking immediate action to protect all at JFK since the documentary aired, and has also commissioned an independent investigation to assess where approaches to safeguarding JFK employees need to be improved. The outcome of this investigation is expected in August, and Browns is contractually committed to implementing any recommendations coming out of that process. This commitment was a key consideration for Finlays during the final stages of the agreement to sell JFK. After the sale completes, Finlays will become one of JFK’s largest customers, and we will be represented on the Steering Group which is overseeing the implementation of Partner Africa’s recommended action plan.
