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Wednesday 12th of June 2019 |
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PEPE ESCOBAR: The Unipolar Moment is Over @Consortiumnews Law & Politics |
The Russia-China strategic partnership, consolidated last week in Russia, has thrown U.S. elites into Supreme Paranoia mode, which is holding the whole world hostage. Something extraordinary began with a short walk in St. Petersburg last Friday. After a stroll, they took a boat on the Neva River, visited the legendary Aurora cruiser, and dropped in to examine the Renaissance masterpieces at the Hermitage. Cool, calm, collected, all the while it felt like they were mapping the ins and outs of a new, emerging, multipolar world. Chinese President Xi Jinping was the guest of honor of Russian President Vladimir Putin. It was Xi’s eighth trip to Russia since 2013, when he announced the New Silk Roads, or Belt and Road Initiative (BRI). First they met in Moscow, signing multiple deals. The most important is a bombshell: a commitment to develop bilateral trade and cross-border payments using the ruble and the yuan, bypassing the U.S. dollar. Then Xi visited the St. Petersburg International Economic Forum (SPIEF), Russia’s premier business gathering, absolutely essential for anyone to understand the hyper-complex mechanisms inherent in the construction of Eurasian integration. I addressed some of SPIEF’s foremost discussions and round tables here. In Moscow, Putin and Xi signed two joint statements – whose key concepts, crucially, are “comprehensive partnership”, “strategic interaction” and “global strategic stability.” It was obvious this was slowly brewing for the past five to six years. Now the deal is in the open. The Russia-China comprehensive strategic partnership is thriving; not as an allied treaty, but as a consistent road map towards Eurasia integration and the consolidation of the multipolar world. Unipolarism – via its demonization matrix – had first accelerated Russia’s pivot to Asia. Now, the U.S.-driven trade war has facilitated the consolidation of Russia as China’s top strategic partner. Moscow better get ready to dodge and counteract reams of reports such as the latest from the RAND corporation, which outlines – what else? – Cold War 2.0 against Russia. In 2014, Russia did not react to sanctions imposed by Washington. Then, it would have sufficed to merely brandish the threat of default on $700 billion in external debt. That would have killed the sanctions. Now, there’s ample debate inside Russian intelligence circles on what to do in case Moscow faces the prospect of being cut off the CHIPS-SWIFT financial clearing system. The problem for the U.S. is the emergence of a formidable peer competitor in Eurasia – and worse still, a strategic partnership. It has thrown these elites into Supreme Paranoia mode, which is holding the whole world hostage. The Deep State will not flinch to unleash concentric havoc on the periphery of both Russia and China and then try to advance to destabilize the heartland from the inside. The Russia-China strategic partnership has generated a sore wound: it hurts – so bad – to be a Eurasia outsider.
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Law & Politics |
Very worried for HK this time around. If Xi is giving the HK govt no choice, which is likely, and HK people are legitimately furious, there’s no middle ground. And given all the other ways Xi is under siege, not backing down and making an example of HK is a very possible outcome.
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International Trade |
Springer CEO has turned Germany’s biggest publisher into a digital media comp. It now makes almost 3/4th of its sales from digital businesses. KKR & Co. is seeking to buy out minority shareholders of Axel Springer SE in a deal that would value the German publisher at about 6.8 billion euros ($7.7 billion). KKR offered to pay 63 euros a share in cash -- a 13% premium over Tuesday’s close and about 40% more than the price before Bloomberg reported the talks last month. The move is backed by largest shareholder Friede Springer and Chief Executive Officer Mathias Doepfner. Axel Springer shares rose as much as 13% to 63.30 euros in early trading in Frankfurt. The private-equity firm’s involvement would hand Doepfner additional financial resources to help the tradition-rich publisher of the Bild mass-circulation daily with the costly and challenging process of transforming into a digital media group, making it easier to acquire struggling rivals. Axel Springer lowered its sales and profit forecast for the year on Wednesday, citing slower growth in classifieds. “Our growth plans will require significant investment in people, products, technology and brands over the next years,” Doepfner said in a statement. “KKR is a long-term focused partner who respects and supports our commitment to independent journalism.” Both Springer -- the widow of the company’s founder -- and CEO Doepfner plan to keep their holdings that together amount to more than 45% of the company. A buyout of minority investors would see Axel Springer join Bertelsmann, the German publisher that owns Penguin Random House, in being shielded from the scrutiny of public markets. More companies are being taken private thanks in large part to buyout firms’ swelling cash reserves. The private equity industry, including real estate, debt and venture funds, is sitting on about $1.4 trillion in unspent cash, according to data compiled by Bloomberg, as institutional investors pour client money into the funds seeking returns. Last year, the number of public-to-private deals hit its highest in more than a decade, according to Bain & Co.’s annual private equity report. In Germany, however, private-equity buyouts are not always successful. Shareholders of classifieds company Scout24 AG last month rejected a 4.9 billion-euro bid from private equity firms Blackstone Group LP and Hellman & Friedman. Axel Springer’s shareholders should accept the “good” offer, bearing in mind the profit warnings for this year and next, said Sarah Simon, an analyst at Berenberg. With EBay Inc.’s assets potentially coming up for sale, “KKR probably wants to use Springer as a platform for further consolidation in the European classifieds market,” Simon said by email. In Germany, Springer remains best known for Bild, Europe’s biggest-selling daily thanks to its political scoops, witty headlines, and paparazzi shots of celebrities. While the publication’s print sales have dropped in the past decade, Doepfner has made up some of that lost revenue with fees paid by more than 500,000 web subscribers. Doepfner has spent almost two decades turning the publisher into a digital media company, shedding printing, newspaper and magazine operations to push into online news with products such as Business Insider and classifieds sites including job portal Stepstone. It now makes almost three quarters of its sales from digital businesses. The sector has been looking shakier in recent years, with several news sites closing or cutting jobs as their owners try to staunch years of losses. Older news titles are fighting back with an increasingly successful subscription-based business model, and Alphabet Inc.’s Google and Facebook Inc. are looking to muscle in on the profitable classifieds business. Springer warned in March it expects operating earnings to decline in 2019 after several quarters of profitable growth. KKR’s voluntary offer to shareholders is subject to a minimum acceptance threshold of 20% and further conditions including foreign investment and merger control clearances. Axel Springer now expects sales and adjusted Ebitda to drop this year, from at the prior year’s level. “For 2020, the continuation of the growth strategy will lead to an adjusted Ebitda significantly below than in 2019,” the company said.
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Ghana and Cote d'Ivoire suspend cocoa beans sales Commodities |
It is part of efforts by the two countries, which supply more than 65 per cent of global cocoa figures, to get stakeholders in the value chain to give farmers a fair price that reflects their contribution to the sustenance of the cocoa industry. Ghana, Cote d'Ivoire propose US$2,600 as maiden floor price for cocoa beans Graphic Online understands that the gesture, which is the first of its kind by the world's top two cocoa growers, is meant to put pressure on stakeholders to adopt a floor price for the soft crop. Under the arrangement for a floor price, the two countries have agreed that none of them will sell their produce in the international market below the agreed minimum price.
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FDI flows into emerging markets fall to lowest levels since 1990s @FT Emerging Markets |
Foreign direct investment in emerging markets has plunged to its lowest level this century as mounting trade tensions build on weakening economic growth in the developing world. FDI, which involves buying companies and building new facilities, fell to just 2 per cent of gross domestic product across emerging and frontier markets last year, according to the Institute of International Finance, which tracks cross-border capital flows. This compares with a peak of 4.4 per cent in 2007, immediately prior to the global financial crisis, as the first chart shows. “FDI fell particularly strongly last year as trade policy uncertainty escalated, but also as part of a broader retrenchment of all types of capital flows in the context of the spike of risk aversion, especially in the fourth quarter,” said Guillermo Tolosa, economic adviser at Oxford Economics, a consultancy. Mr Tolosa argued there was a strong correlation between FDI inflows into emerging markets and the degree to which EM economic growth outstrips that of the developed world, a differential that has tumbled from 6.1 percentage points in 2009 to just 2.3 points last year, shown in the third chart. “FDI to emerging markets in terms of EM GDP has been falling since 2008, in line with the systematic fall of the growth differential of EM and advanced markets,” Mr Tolosa said. “As EMs have become relatively less dynamic, it makes sense they receive less investment.” In addition, he argued that the opportunities from fiscal or labour arbitrage have declined, while investment has also become more “asset-lite”, meaning fewer dollars are needed for a given impact.
Frontier Markets
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Ethiopia forecasts 9% growth, plans higher spending in 2019/2020 @ReutersAfrica Africa |
Ethiopia’s economy is projected to grow by 9% in 2019/2020, finance minister Ahmed Shide told lawmakers on Tuesday as he presented plans to raise spending. Ahmed proposed 386.9 billion birr ($13.48 billion) in government spending for 2019/2020, which if approved will be 12% higher than 2018/19’s 346.9 billion birr figure. Lawmakers from the ruling coalition, who dominate parliament, are expected to approve the plans over the next few weeks. The International Monetary Fund projected the country’s growth for 2019 at 7.7% in April.
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@KremlinRussia_E ally Yevgeny Prigozhin leading push to turn continent into strategic hub, documents show @guardiannews Africa |
Russia is seeking to bolster its presence in at least 13 countries across Africa by building relations with existing rulers, striking military deals, and grooming a new generation of “leaders” and undercover “agents”, leaked documents reveal. The mission to increase Russian influence on the continent is being led by Yevgeny Prigozhin, a businessman based in St Petersburg who is a close ally of the Russian president, Vladimir Putin. One aim is to “strong-arm” the US and the former colonial powers the UK and France out of the region. Another is to see off “pro-western” uprisings, the documents say. In 2018 the US special counsel Robert Mueller indicted Prigozhin, who is known as “Putin’s chef” because of his Kremlin catering contracts. According to Mueller, his troll factory ran an extensive social media campaign in 2016 to help elect Donald Trump. The Wagner group – a private military contractor linked to Prigozhin – has supplied mercenaries to fight in Ukraine and Syria. The documents show the scale of Prigozhin-linked recent operations in Africa, and Moscow’s ambition to turn the region into a strategic hub. Multiple firms linked to the oligarch, including Wagner, are known by employees as the “Company”. Its activities are coordinated with senior officials inside Russia’s foreign and defence ministries, the documents suggest. Putin showed little interest in Africa in the 2000s. But western sanctions imposed in 2014 over the annexation of Crimea have driven Moscow to seek new geopolitical friends and business opportunities. Russia has a military presence and peacekeeping mission in Central African Republic. CAR is described as “strategically important” and a “buffer zone between the Muslim north and Christian south”. It allows Moscow to expand “across the continent”, and Russian companies to strike lucrative mineral deals, the documents say. On 24 May the Kremlin announced it was dispatching a team of army specialists to the neighbouring Democratic Republic of the Congo. According to Dmitry Peskov, Putin’s press spokesman, they will service Russian-made military equipment. So far Moscow has signed military cooperation deals with about 20 African states. Five days later the Kremlin said it would host the first ever Russia-Africa summit in October in the Black Sea resort of Sochi. Putin and Egypt’s president, Abdel Fatah al-Sisi, will chair the event. About 50 African leaders are due to attend. The aim is to foster political, economic and cultural cooperation. The leaked documents were obtained by the Dossier Center, an investigative unit based in London. The centre is funded by Mikhail Khodorkovsky, the Russian businessman and exiled Kremlin critic. Prigozhin has been approached for comment. He has previously denied any links to the troll factory and has said of Wagner that it does not exist. Putin has previously said that entities linked to Prigozhin do not constitute the Russian state. A map from December 2018 seen by the Guardian shows the level of cooperation between the “Company” and African governments, country by country. Symbols indicate military, political and economic ties, police training, media and humanitarian projects, and “rivalry with France”. Five is the highest level; one is the lowest. The closest relations are with CAR, Sudan and Madagascar – all put at five. Libya, Zimbabwe and South Africa are listed as four, according to the map, with South Sudan at three, and DRC, Chad and Zambia at two. Other documents cite Uganda, Equatorial Guinea and Mali as “countries where we plan to work”. Libya and Ethiopia are flagged as nations “where cooperation is possible”. The Kremlin has recently stepped up its ground operation in Libya. Last November the Libyan commander Khalifa Haftar travelled to Moscow and met the defence minister, Sergei Shoigu. Prigozhin was spotted at the talks. Egypt is described as “traditionally supportive”. The graphic gives an overview of “Company” activities and achievements. It claims credit in CAR for getting of rid of politicians who are “orientated to France”, including national assembly representatives and the foreign minister. This appears to be Charles-Armel Doubane, sacked in December. It has “strengthened” the army and set up newspapers and a radio station. Russia is an “83% friend”, it says. In Madagascar the new president, Andry Rajoelina, won election with “the Company’s support”, the map says. Russia “produced and distributed the island’s biggest newspaper, with 2 million copies a month”, it adds. Rajoelina denies receiving assistance. Another key territory is Sudan. Last year Russian specialists drew up a programme of political and economic reform, designed to keep President Omar al-Bashir in power. It included a plan to smear anti-government protesters, apparently copy-pasted from tactics used at home against the anti-Putin opposition. (One memo mistakenly says “Russia” instead of “Sudan”.) One ploy was to use fake news and videos to portray demonstrators in Khartoum and other Sudanese cities as “anti-Islam”, “pro-Israel” and “pro-LGBT”. The government was told to increase the price of newsprint – to make it harder for critics to get their message out – and to discover “foreigners” at anti-government rallies. In a leaked letter Prigozhin wrote to Bashir complaining that the president had not actually followed through on the advice. Prigozhin mentioned “lack of activity” by the Sudanese government and its “extremely cautious position”. The military deposed Bashir in April in a coup. Last week Sudan’s Rapid Support Forces opened fire on pro-democracy protesters, killing scores. The Russian advisers had urged Sudan’s military council to suppress the activists with “minimal but acceptable loss of life”, one former regime source told CNN. Meanwhile, Moscow is keen to exploit a long-running territorial dispute in Comoros, the documents say. France directly controls one out of four of the Indian Ocean islands, Mayotte. In 2018 Prigozhin employees flew to Comoros via Belarus. Their objective was to test if “political technologies” might be used to inflame the row between Paris and the Comoros government. Other suggestions in the documents include trans-African road and rail-building schemes. A railway could be built linking Dakar in Senegal with Port Sudan in Sudan, along the “old hajj [pilgrimage] route”. A separate 2,300-mile (3,700km) toll road was proposed connecting Port Sudan with Douala in Cameroon. Neither has so far happened. A plan to revive “pan-African consciousness” appears closely modelled on the idea of Russkiy Mir, or Russian world. The concept has become fashionable under Putin and signifies Russian power and culture extended beyond current borders. One working paper is titled “African world”. It calls for a developing “African self-identity”. It recommends collecting a database of Africans living in the US and Europe, which might be used to groom “future leaders” and “agents of influence”. The eventual goal is a “loyal chain of representatives across African territory”, the March 2018 paper says. More immediate practical measures include setting up Russian-controlled non-governmental organisations in African states and organising local meetings. It is unclear how many Prigozhin initiatives have actually gone forward. There is evidence that media projects mentioned in the documents are now up and running – albeit with marginal impact. They include a website, Africa Daily Voice, with its HQ in Morocco, and a French-language news service, Afrique Panorama, based in Madagascar’s capital Antananarivo. Russian operatives also offer thoughts on global politics. One policy paper, titled “Russian influence in Africa”, says Moscow needs to find “reliable partners among African states” and should establish military bases.
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Direct quotes from @AssociationSd's Mohamed Yusif on the SPA's reasons for suspending the strike: @thomas_m_wilson Africa |
"People in the informal sector, those who are completely without any income. They need to make some revenue generating activities..." "At the same time we need to provide an opportunity for this mediation to go smoothly without accusations from the military council that we are trying to cause problems" "There will be no direct talks at all. Any talks will be through a mediator. Now we have the bitter experience, that always they [the TMC] change their position. Also they change their grounds so it is very difficult to handle them." "Now they [the TMC] have a total monopoly on mass media, we have no access to the media so in that context it is important for us to ensure that there is always someone, a third party to witness what they are saying so they cannot change it at any time"
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Nigeria Central Bank Quashes Talk of Exchange-Rate Policy Change Africa |
Nigeria’s central bank said it’s made no change to its naira policies, after a revision on its website led some analysts to speculate that it was ending a system of multiple exchange rates. “Nothing has changed in Nigeria’s exchange-rate structure,” and the naira’s value continues to be determined by trading in the Investors’ & Exporters’ FX Window, Isaac Okorafor, a spokesman for the Abuja-based institution, said in a text message. The I&E FX window, also know as the Nafex window, was introduced in 2017 as Nigeria sought to attract capital inflows by offering investors a weaker and market-determined naira rate. The central bank pegs an official rate -- meant for government bodies and fuel importers -- at about 20% stronger than the market price. The central bank’s homepage on Tuesday stated that the official rate was “market-determined,” whereas it previously gave a value. The website reverted back to its original form on Wednesday.
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Africa's Fastest-Growing Region Banks on More Spending for Growth Africa |
East African countries plan to increase spending dramatically on infrastructure projects in budgets to be released Thursday. It’s not clear they can afford it. Kenya, Tanzania, Uganda, Rwanda and Burundi will unveil plans to fund the building of more roads, railways and power plants, as well as expand services such as health care and education, for the year starting July 1. In most cases, this will raise budget gaps as a percentage of gross domestic product, and increase borrowing requirements. “There is a risk of rising fiscal deficits coming from the fact that many have ambitious revenue targets they may fail to meet,” said Tony Watima, a Nairobi-based independent economist. Spending will probably climb about 10% in Kenya in the next fiscal year, 17% in Uganda and 11% in Rwanda, while it will be broadly flat in Tanzania, the nations’ respective governments have said in forecasts. While the governments forecast that revenue will increase by double digits next year, Kenya, Uganda and Tanzania all have plans to approach the debt markets to help raise the funds to finance their deficits. In Kenya’s case, the nation will borrow about 607 billion shillings ($6 billion) locally and internationally in 2019-20, according to Treasury Secretary Henry Rotich. GDP in East Africa will probably expand 5.9% in 2019 and 6.1% in 2020, according to the African Development Bank, making it the fastest-growing region on the continent. Kenya is implementing its so-called Big Four agenda, which will see the region’s largest economy hand over no less than 500,000 houses to first-time homeowners by June 2022, and develop more manufacturing, food production and health care to create jobs in a nation where unemployment is a sticking electoral issue. The projects will cost 405 billion shillings ($4 billion) in the coming year, budget estimates show. If approved by lawmakers, about 7.5% of Tanzania’s 33.1 trillion-shilling ($14 billion) budget will go toward building a standard-gauge railway line that will link the East African nation’s commercial city of Dar es Salaam with the town of Mwanza along Lake Victoria, through the capital, Dodoma. The country is due this month to start building the 2,115-megawatt Rufiji hydropower project. The International Monetary Fund in April said that Tanzania’s economy is being harmed by the “unpredictable and interventionist policies” of President John Magufuli’s government. It said this in a report whose release the East African country has blocked. “The Magufuli administration hasn’t done a good job in enticing investors to enter the country, and erratic policy making will in fact continue to have the opposite effect,” said Jacques Nel, the chief economist for southern and eastern Africa at NKC African Economics.
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Bad bank loans hit an all-time high Sh345bn Kenyan Economy |
The value of bad loans in the banking sector hit a new high of Sh345 billion at the end of March, raising questions on the health of the economy even as the lenders booked double-digit profit growth in the first three months of the year. Banking sector data compiled from the lenders’ financial reports shows that gross non-performing loans increased by Sh27.5 billion or 8.7 percent in the first quarter of 2019. The non-performing loans piled up even as banks reported a 22 percent year-on-year rise in first quarter net profit to Sh33.6 billion. Central Bank of Kenya data shows that credit to the private sector expanded by 4.9 percent in the 12 months to April 2019, well below the 12 to 15 percent considered optimal to fuel healthy economic growth.
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@CentumPLC reports FY Earnings EPS +68.687% Kenyan Economy |
Par Value: 0.50/- Closing Price: 32.80 Total Shares Issued: 665441775.00 Market Capitalization: 21,826,490,220 EPS: 6.68 PE: 4.91
Centum Investment Company PLC FY 2018/ 19 results through 31st March 2019 vs. 31st March 2018 FY Sales 10.864087b vs. 10.171132b +6.813% FY Direct and other operating costs [9.746717b] vs. [9.102223b] +7.081% FY Trading profit 1.117370b vs. 1.068909b +4.534% FY Income from financial services 3.502548b vs. 2.844698b +23.125% FY Funding and other costs [3.963785b] vs. [3.385289b] +17.089% FY Operating loss from financial services [461.237b] vs. [540.591m] -14.679% FY Investment and other income 9.852606b vs. 5.712840b +72.464% FY Operating and administrative costs [2.128453b] vs. [2.028205b] +4.943% FY Finance costs [2.517605b] vs. [1.761201b] +42.948% FY Share of profits from associates and joint ventures [1.423835b] vs. 694.898m -304.898% FY Profit before tax 4.438846b vs. 3.146650b +41.066% FY Profit from continuing operations 4.120246b vs. 2.656298b +55.196% FY Profit from discontinued operation, net of tax – vs. 135.600m % FY Profit for the year 4.120246b vs. 2.791898b +47.579% Basic EPS 6.68 vs. 3.96 +68.687% NAV per share 79.05 vs. 73.16 +8.051% Closing cash and cash equivalents 5.284b vs. 4.074b +29.701% Dividend 1.20 vs. 1.20 – Total Assets 101.764b vs. 96.288b +5.687% Total Equity 51.576b vs. 50.897b +1.334%
DIVIDEND DECLARATION The Board of Directors has recommended the payment of a dividend equivalent to KES 1.20 per share for the financial year ended 31 March 2019 12018: KES 1.20 per share).
FINANCIAL PERFORMANCE The year ended 31 March 2019 marked the end of our five-year strategy period dubbed 'Centum 3.0'. Over that five-year period, the Company's assets grew by 249% from KES 28.8 billion to close at KES 71.6 billion as at 31 March 2019. N. Asset Value (NAVI per share on the hand grew by 229% from KES 34.5 to KES 79 as at 31 March 2019. The NAV per share has grown at a compounded annual growth rate of 18% since the commencement of our current strategy period in 2014, underscoring the Group's commitment to sustained value creation for its shareholders. This growth was primarily funded by internally generated funds and borrowings as the Company elected not to raise new equity. Through either full or partial exits in our investment portfolio over the strategy period, we raised KES 36.3 billion in exit proceeds, which resulted in realised capital gains of KES 24.3 billion. These internally generated funds were complemented by two corporate bond raises amounting to KES 10.2 billion and a bank term loan of KES 7.5 billion. Of the two bond raises, the first bond of KES 4.2 billion which matured in September 2017 was successfully redeemed through internally generated funds. Investors in the equity linked component (ELNI of that bond received an additional KES 191 million, representing a total equity upside of 15 percent of the par value in line with the terms of the issue, which translated to an annual internal rate of return of 14.9 percent for ELN investors. The Company's gearing over the strategy period was on account of new projects, under our development strategy focus. The respective real estate projects are now cash generative and able to raise non-recourse debt on their own. Accordingly, as communicated in our previous investor briefing, we plan to deleverage the Company through payment of all maturing liabilities between 2019 and June 2020. GROUP PERFORMANCE The Group recorded a consolidated profit growth of 48% from KES 2.7 billion in 2018 to KES 4.1 billion for the financial year ended 31 March 2019. The primary performance drivers under our respective three business units are set out below. I. PRIVATE EQUITY During the year, the Group completed the disposal of GenAfrica Asset Managers Limited, realising a gain of KES 1.2 billion. Through this transaction, the Group achieved a holding period IRR of 29% for the investment, demonstrating our track record in growing shareholder wealth through an optimal investment strategy, portfolio management and successful exits. The Group's beverage business reported a flat performance in revenues, with a nominal decrease of 3%. This performance was largely on account of weather-related distribution channel disruptions in 2018 and depressed consumer demand in the fir, half of the year. This trend has however reversed in the quarter ended 31 March 2019, with revenues growing by 22% compared to a similar period last year. The Group's banking subsidiary, Sidian Bank Limited, has seen significant improvement in its performance compared to the prior year. The bank's focus on growing its non-funded income through growth in trade finance business has seen non-funded income increase by 44% compared to 2018. Notably, non-funded income was higher than net interest income during the period while trade finance balances have grown by 77% over the last 12 months, demonstrating the successful implementation of the bank's new strategic focus. The bank has also recorded a 10% growth in total assets and 14% in customer deposits over the twelve-month period ended 31 March 2019. To support this growth, we recapitalised the bank in 2018 through a full subscription to its KES 1.2 billion rights issue. The bank also closed on a KES 1.2 billion Tier II Capital Facility from Denmark's Investment Fund for Developing Countries (IFU). The bank's strong capital base, balance sheet and trade finance book have provided it with a strong growth platform that saw it return to profitability in the quarter ended 31 March 2019. Within the trading subsidiaries segment, Longhorn Publishers Limited recorded a 141% growth in profitability over the twelve-month period to 31 March 2019, driven by a strong top line performance, on account of both geographical and product diversification.
REAL ESTATE Our focus in the real estate portfolio is monetisation of our land banks through in-fill projects development or sale of development rights. During the year, we closed a number of development rights sales in our land banks at valuation multiples that are several times our book carrying value. In addition, residential projects across our three land banks have recorded strong pre-sale performance over the year. We are currently developing 3,000 residential units, of which the first phase of 1,200 units is under construction. Over a ten-month period, we have attained a 51% (606 units) pre-sale level on the units under construction, with a sales value of KES 5.2 billion . We also broke ground at our Vipingo Industrial Park, where some of the referenced development rights were sold. The underlying activity and sales in the real estate portfolio saw a growth of KES 3.3 billion in fair value gains across the portfolio.
MARKETABLE SECURITIES The Group held a marketable securities portfolio of KES 3.1 billion as at 31 March 2019 (2018: KES 3.4 billion). During the period, the portfolio recorded a realised cash investment income of KES 400 million. Consistent with the overall performance of markets, particularly the NSE, the portfolio valuation decreased by KES 533 million during the year.
OUTLOOK We have commenced implementation of our new 5-year strategy dubbed 'Centum 4.0' that covers the period April 2019 to March 2024. Under the new strategic plan, our business has been simplified into 3 business units, namely Private Equity, Real Estate and Marketable Securities. Across the three business units, we are targeting to grow our total returns at an annual rate of 20%, with specific targets for cash returns. We believe that the momentum and scale achieved over Centum 3.0 provides us with a strong growth platform for both the Private Equity and Real Estate businesses. Specifically, for Private Equity, Centum will be investing between KES 10 billion and 15 billion over the next 5 years in a fund to be managed by its wholly-owned subsidiary, Centum Capital Partners Limited. Within Real Estate, our focus over the next five years will be continued activation of our development sites and land bank monetisation through infill projects and sale of development rights. Our current development pipeline comprises of 3,000 residential units across our existing development sites. A further 2,000 are at the concept stage. In addition to our existing sites, we are actively pursuing opportunities in affordable mid-market housing where we look to develop over 5,000 units over the next five years. We have received committed funding for this development pipeline. On land development rights sales, some transactions were closed during the year while we have a rich pipeline of sales under negotiation. On 10 June 2019, we entered into agreements to sell our total combined shareholding in Almasi Beverages Limited and Nairobi Bottlers Limited to Coca-Cola Beverages Africa Limited at a combined valuation of KES 19.5 billion. This is an event subsequent to the balance sheet date and the realised gains are therefore not reflected in the results for the year ended 31 March 2019. The two investments are carried at KES 16.8 billion on the balance sheet as at 31 March 2019. We expect to complete the transaction in the financial year ending 31 March 2020. The proceeds from these transactions will be applied towards repaying our current US Dollar denominated bank term loans of KES 7.5 billion, which will result in finance cost savings of KES 700 million. The balance of the proceeds will be invested in our Private Equity and Marketable Securities portfolios.
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