Just one week after announcing its closure, Kenya-based automaker Mobius Motors has accepted an acquisition offer from an undisclosed buyer. The company, which had been grappling with financial difficulties, including delayed creditor meetings and uncertain future prospects, now sees a potential revival under new ownership.
Acquisition Details
On August 14, 2024, Mobius Motors formally accepted a bid for the acquisition of 100% of its shares, according to a statement by Nicolas Guibert, a Mobius director. While the identity of the buyer remains confidential, both parties aim to finalize the transaction within 30 days. This development comes after a tumultuous period for the automaker, which had initially planned a creditor meeting on August 17, now postponed to accommodate the ongoing negotiations.
Strategic Value of Mobius Motors
The buyer is likely interested in leveraging Mobius Motors’ extensive manufacturing facilities in Nairobi. The plant is capable of performing various operations, including vehicle frame fabrication, anti-corrosion treatment, general assembly, painting, quality testing, and final inspection. Additionally, Mobius Motors boasts a robust research and development unit, making it a valuable asset for any automaker looking to establish or expand their presence in the East African market.
The facility’s potential to continue producing Mobius cars, which are designed to meet the unique demands of small and medium enterprises (SMEs) in infrastructure, agribusiness, and supply chain operations in remote areas, could be a key factor in the acquisition. Mobius vehicles, known for their durability and affordability, are well-suited to the challenging road conditions across Africa.
Historical Context and Challenges
Founded in 2009 by British entrepreneur Joel Jackson, Mobius Motors initially gained attention for its stripped-down, cost-effective SUVs tailored to African roads. The company’s first model, the Mobius I, was launched in 2014 at a price of $10,000 (KES 1.3 million), significantly undercutting the cost of imported SUVs in Kenya. Despite its promising start, the company faced escalating challenges, particularly in scaling production and maintaining financial stability.
In partnership with Chinese automaker BAIC, Mobius launched the Mobius III, an advanced version of its earlier models. Priced at $43,000, the Mobius III was still more affordable than comparable models from global brands like Toyota and Land Rover, which retailed for over $65,000 in Kenya. Despite this competitive pricing, Mobius struggled to achieve the necessary market penetration to sustain its operations.
Recent Developments and Industry Response
The acquisition offer comes shortly after reports that two potential buyers were considering rescuing the beleaguered automaker. This interest was sparked by the intervention of Hassan Abubakar, Permanent Secretary for Trade and Industry, and the Kenya Association of Manufacturers (KAM), who visited Mobius Motors’ plant to discuss possible rescue plans.
Mobius Motors’ potential acquisition underscores the ongoing challenges and opportunities within Kenya’s automotive industry. As the country seeks to build a more resilient and competitive industrial base, the fate of Mobius Motors will be closely watched by industry stakeholders and policymakers alike.