@StandardMedia

Local shareholders frustrate Unga Group take over by Americans despite huge odds

4 months ago, 21 July 00:00

By: Otiato Guguyu

Even with the backing of the biggest shareholder at flour miller Unga Group, American firm Seaboard could still not wrench away shareholding from adamant Kenyans who refused to sell their stake.

The American firm and Victus Limited had created a holding group in 2002 where Unga Group Ltd holds 65 per cent stake and Seabord 35 per cent stake and used this vehicle to operate subsidiaries.

The Delaware firm wanted to buy 46.15 per cent stake to increase its shareholding from 2.92 per cent to 49 per cent making it a partnership with Victus, owned by the family of the late Philip Ndegwa, a former Central Bank governor. Victus owns 50.93 per cent of Unga Group.

A long-drawn out war ended Friday when shareholders with only 16 per cent stake agreed to the deal and Seaboard opted to take their stake to increase its shareholding to 18.9 per cent.

Seabord offered Sh40 per share for the company whose shares were trading at Sh29.5 at the time of announcement.

Opposition to the deal was seen immediately that market activity rallied to hit a high of Sh44 as shareholders felt the deal was undervalued.

When the deal approached closure, Seaboard asked CMA to extend the deadline blaming the dismal performance on changes in postal addresses and/or relocation of shareholders.

CMA gave them an additional 10 days to turn the tide yet they still could not manage to convince some shareholders.

Seaboard now says 8.1 per cent of shareholders who never responded have been handed over to Unclaimed Financial Assets Authority.

This is the second bid to take over a Nairobi Securities Exchange listed firm that has fallen flat on its face with shareholders opting to stay put.

Shareholders refused to sell their stake in Express Kenya to the firm's CEO.


Read More


Category: business news

Suggested

5 hours ago, 22:04
@BusinessDaily - By: Patrick Alushula ...
Rotich adds debt load with Sh520bn EU loans, grants

Kenya has signed a five-year €4.5 billion (Sh520 billion) loans and grants deal with the European Union (EU), adding to the country’s debt load that now stands at Sh5.146 trillion. ...

Category: business opinion news
14 hours ago, 13:28
@TheEastAfrican - By: Kabona Esiara
Bank of Kigali share price falls ahead of rights issue

Rwanda’s biggest lender hopes to raise $70 million to allow shareholders increase stakes. ...

Category: topnews news business
9 hours ago, 18:09
@BusinessDaily - By: Edwin Okoth
Fuel use falls 25pc after September tax increase

Motorists cut fuel consumption by a quarter in the first month when Kenya introduced the eight percent Value Added Tax (VAT) on petroleum products, hitting government revenue. ...

Category: business news
16 hours ago, 11:58
@TheEastAfrican - By: Annie Njanja
Burundi, Kenya fight over aircraft deployment

Bujumbura unhappy with planned deployment, terms it unbefitting of the status of its govt officials ...

Category: topnews news business
5 hours ago, 22:15
@BusinessDaily - By: Eric Matara
Kinyanjui defends foreign trips, denies wastage claim

Nakuru Governor Lee Kinyanjui has defended his numerous foreign trips, saying they were donor-funded and aimed at spurring economic development in the county. ...

Category: business news
9 hours ago, 18:09
@BusinessDaily - By: John Mutua
Chinese lender withdraws Sh7bn mineral survey funding

Exim Bank of China has pulled out of the Sh7 billion funding for the airborne survey of minerals amid Kenya’s decision to freeze the contract issued to a Chinese firm. ...

Category: business news

@StandardMedia

Local shareholders frustrate Unga Group take over by Americans despite huge odds

4 months ago, 21 July 00:00

By: Otiato Guguyu

Even with the backing of the biggest shareholder at flour miller Unga Group, American firm Seaboard could still not wrench away shareholding from adamant Kenyans who refused to sell their stake.

The American firm and Victus Limited had created a holding group in 2002 where Unga Group Ltd holds 65 per cent stake and Seabord 35 per cent stake and used this vehicle to operate subsidiaries.

The Delaware firm wanted to buy 46.15 per cent stake to increase its shareholding from 2.92 per cent to 49 per cent making it a partnership with Victus, owned by the family of the late Philip Ndegwa, a former Central Bank governor. Victus owns 50.93 per cent of Unga Group.

A long-drawn out war ended Friday when shareholders with only 16 per cent stake agreed to the deal and Seaboard opted to take their stake to increase its shareholding to 18.9 per cent.

Seabord offered Sh40 per share for the company whose shares were trading at Sh29.5 at the time of announcement.

Opposition to the deal was seen immediately that market activity rallied to hit a high of Sh44 as shareholders felt the deal was undervalued.

When the deal approached closure, Seaboard asked CMA to extend the deadline blaming the dismal performance on changes in postal addresses and/or relocation of shareholders.

CMA gave them an additional 10 days to turn the tide yet they still could not manage to convince some shareholders.

Seaboard now says 8.1 per cent of shareholders who never responded have been handed over to Unclaimed Financial Assets Authority.

This is the second bid to take over a Nairobi Securities Exchange listed firm that has fallen flat on its face with shareholders opting to stay put.

Shareholders refused to sell their stake in Express Kenya to the firm's CEO.


Read More

Category: business news

Suggested

5 hours ago, 22:04
@BusinessDaily - By: Patrick Alushula ...
Rotich adds debt load with Sh520bn EU loans, grants

Kenya has signed a five-year €4.5 billion (Sh520 billion) loans and grants deal with the European Union (EU), adding to the country’s debt load that now stands at Sh5.146 trillion. ...

Category: business opinion news
14 hours ago, 13:28
@TheEastAfrican - By: Kabona Esiara
Bank of Kigali share price falls ahead of rights issue

Rwanda’s biggest lender hopes to raise $70 million to allow shareholders increase stakes. ...

Category: topnews news business
9 hours ago, 18:09
@BusinessDaily - By: Edwin Okoth
Fuel use falls 25pc after September tax increase

Motorists cut fuel consumption by a quarter in the first month when Kenya introduced the eight percent Value Added Tax (VAT) on petroleum products, hitting government revenue. ...

Category: business news
16 hours ago, 11:58
@TheEastAfrican - By: Annie Njanja
Burundi, Kenya fight over aircraft deployment

Bujumbura unhappy with planned deployment, terms it unbefitting of the status of its govt officials ...

Category: topnews news business
5 hours ago, 22:15
@BusinessDaily - By: Eric Matara
Kinyanjui defends foreign trips, denies wastage claim

Nakuru Governor Lee Kinyanjui has defended his numerous foreign trips, saying they were donor-funded and aimed at spurring economic development in the county. ...

Category: business news
9 hours ago, 18:09
@BusinessDaily - By: John Mutua
Chinese lender withdraws Sh7bn mineral survey funding

Exim Bank of China has pulled out of the Sh7 billion funding for the airborne survey of minerals amid Kenya’s decision to freeze the contract issued to a Chinese firm. ...

Category: business news
Our App