Deal #1999

PHC/KKM2

Founded in 1911. Feronica acquired these plantations by buying 76% of Plantations et Huileries du Congo (PHC, registered in DR Congo). Feronia purchased these shares from Unilever. The company which purchased these shares was Feronia JCA Ltd, a Cayman Islands subsidiary of Feronia Inc. DRC passed a new Law on the Funadmaental Principles of Agriculture (loi portant principes fondamentaux relatifs à l’agriculture) on June 24, 2012 that states, under Article 16, that land can only be attributed to companies that are majority owned by national investors. Company plans to list on the British stock exchange in 2018. Mafuta Investment Holdings fund and Kuramo Capital have injected $ 17.5 million into the capital- October 2017 (% share unknown as yet). By 2018, Feronia-PHC had received at least 118 million US dollars, including 49 million in loans approved by German, Belgian and Dutch development banks in 2015. "They approved the loans despite NGO reports and statements from community leaders in all three plantation areas who had drawn their attention to the illegitimate and possibly illegal nature of the concession contracts as well as the appalling working conditions for labourers on the plantations and the many broken promises to communities affected by the plantation concessions." A complaint was submitted through the DEG complaints mechanism. On January 7th, 2018 it determined that the complaint was admissible under the criteria of the Independent Complaints Mechanism Policy, and the case is under review. In June 2019 Golden Oil Holdings Limited ("GOHL"), a wholly owned Mauritius special purpose vehicle subsidiary of African Agriculture Fund L.L.C. ("AAF”) announces that it has acquired common shares representing approximately 13.55%. In May 2020, Feronia announes that they are looking to restrucutre the investors/ shareholdering structure in this deal or alterantively sell the operating company to an affiliate of KKM. However, they also clearly state that this is not a final decision and the plans may still change. Meanwhile, the actual ownership of the company is still being contested in court procedures in New York, Delaware, Canada and DR Congo. The side that appears to be winning is led by Kuramo Capital and its investors, which includes the endowments of the University of Michigan, Washington University in St. Louis, Northwestern University, and Kamehameha Schools, as well as the Bill & Melinda Gates Foundation and the South African Government Employees Pension Fund and Public Investment Corporation. A critical juncture was reached when Feronia filed for bank-ruptcy in August of 2020. Instead of exploring ways to grant the communities their long held request for the return of the land, development banks handed over the assets that Fero-nia held in PHC to Straight KKM, a Mauritius-based private equity fund, for a cash payment of US$500,000, an assump-tion of a portion of the company’s debt to the development banks, and a commitment to invest US$10 million into the company. Through the sale, the development banks involved – UK’s CDC Group, Germany’s DEG, the Dutch FMO, Belgian BIO, and the Emerging Africa Investment Fund (EAIF) agreed to write off large portions of their previous loans to the com-pany. However, these banks remain involved in the project as lenders. Straight KKM is owned by various funds affiliated with Kura-mo Capital Management, which claims to be Africa’s “leading independent investment management firm.” Several institu-tional players are major investors in Kuramo funds, including: The University of Michigan Endowment, the Bill & Melinda Gates Foundation Trust, the South African Government Em-ployees Pension Fund and Public Investment Corporation, the Royal County of Berkshire Pension Scheme, among others." (Oakland Institute, 2021). In April 2021, African Centre for Biodiversity (ACB), an environmental watchdog, said the South African government’s involvement in PHC was highly inappropriate: “The bottom line here is that GEPF has invested the money of South African workers to entrench dispossession of peoples’ territories and colonial patterns of land ownership and power in the DRC,” said ACB’s executive director Mariam Mayet. Moreover.Kuramo Capital Management( KCM ) is involved in a legal battle over ownership of PHC Oil palm plantations in the DRC.A legal battle has erupted over the ownership of the Plantations et Huileries du Congo (PHC), an oil palm firm, which controls over 100,000 hectares of land in the Democratic Republic of Congo (DRC).After acquiring majority ownership in the PHC plantations from European development banks in 2020, former partners have turned on each other with legal action underway across four jurisdictions for control of the company, valued at US$100 million Evlin Kuyek, researcher at GRAIN mentioned that Before KCM assumed control over the plantations, several European development banks held the majority of shares in PHC through Feronia and invested over US$150 million in the company from 2013 to 2020. When Feronia filed for bankruptcy in 2020, the development banks agreed to pass the assets they held in PHC to a private equity fund controlled by the KCM for a cash payment of US$500,000 and agreed to write off large portions of their remaining debt. The deal was conditional on the new owners investing US$10 million in PHC and implementing a revised environmental and social action plan. PHC's new Director General, Monique Gieskes, was sentenced in 2021 by a court in the DRC to six months in prison and required to repay $780,000 that she is reported to have stolen from a Dutch clothing company she represented in the DRC. In 2020, another group, called KKM2 took over from the PHC. KCM is the majority owner of Plantations et Huileries du Congo (PHC), which operates three oil palm plantations in the northern Democratic Republic of Congo. Several legal battles are raging between shareholders for the control of the Plantations et Huileries du Congo (PHC) oil palm plantations in the Democratic Republic of the Congo (DRC). Walé Adeosun, Founder and Chief Investment Officer of Kuramo Capital Management, is accused of fraud and money laundering. In 2024,PHC SA was plagued by accusations of financial mismanagement, including unauthorized bonus payments and suspicious financial transactions. The Congolese directors have accused the general director Monique Gieskes and the majority shareholder SKKM2 of significant financial irregularities, including a substantial bonus payment and transactions linked to money laundering and the financing of insurgent movements like M23.The Congolese government, a minority stakeholder in the company, is advocating for a thorough audit to improve company management. However, the appointment of Julia Luhonga as the new Board President, a decision made by the Portfolio Minister, has been met with opposition from the majority shareholder SKKM2, who are perceived as trying to dodge oversight from the state.