Was it a suspension or a market halt; Circus of Unga group

EQUITIES

The Equities market was dominated by the circus surrounding the offer to take over Unga group from minority shareholders.

American firm Seaboard offered to buy the small shareholders for Sh40 a share when the shares traded at Sh29.5.

Unga Group recorded a 46.15 percent gain to close the week at Sh42.75 with shares worth Sh20.9 million transacted.

The acquisition has however faced an opposition which saw activity in the counter hit a high of Sh44 and settle at Sh42 by Friday close, reflecting a rejection of the offer price.

The regulator was thrown into the eye of the storm and the Capital Markets Authority had to defend its decision to suspend trading the shares of Unga Group for a day.

“The CMA wishes to unequivocally state that at no time has this counter been suspended from trading. The Nairobi Securities Exchange (NSE), in accordance with its Trading Rules, placed a trading halt on Unga upon the release of material information during a trading session and in connection with the Exchanges desire to seek further information from the company regarding the transaction. A trading halt is a temporary measure, which is wholly distinct from a suspension under the law,” CMA said.

It will be interesting to watch the counter unfold especially since Seaboard only requires 75 percent of aggregated approvals from current owners if it cannot get 90 percent of the Kenyan company shareholders to agree on selling the firm.

Victus former Central Bank governor, the late Phillip Ndegwa family business is said to have approved the deal. The two firms created a holdings group; in 2002 where Unga Group limited holds 65 percent stake and Seabord owns 35 percent stake and used this vehicle to operate subsidiaries.

Overall the market saw a week on week turnover drop by 59 percent to Sh2.7 billion on a volume of 98 million shares, down from Sh6.6 billion on 215 million shares posted the previous week.

INDICES

The NSE 20 share Index dropped 27.77 points to stand at 3713.25 while the All Share Index (NASI) was up 0.29 points to stand at 180.25. The NSE 25 Share index was up 2.88 points to stand at 4511.95.

Banking Sector

Equity Bank traded between Sh42.25 and Sh43.50 trading 12 million shares while KCB touched a week high of Sh46.00 and a low of Sh44.75 with shares worth Kes.422M transacted. NIC Group moved 5.2M shares worth Sh185M and closed the week at Sh36.00.

Construction & Allied Sector

Bamburi Cement was the most traded counter in this sector during the week with 458,000 shares between Sh174.00 and Sh180.00.

Energy Sector

KenolKobil stirred up activity in this sector during the week with 17.8M shares changing hands at between Sh15.00 and Sh15.50. KenGen shares slipped by 1.20 percent to close the week at Sh8.20 with shares worth Sh42M realized.

Investment Sector

After touching a 12-Month high of Sh46.50, Centum eased down to close the week at Sh45.75 with shares worth Sh62.5M realized.

Manufacturing & Allied Sector

E.A Breweries moved 412,000 shares valued at Sh103M at between Sh245.00 and Sh250.00.

Telecommunication Sector

Safaricom was the week’s biggest mover with 18.8M shares valued at Sh546M changing hands at between Sh28.00 and Sh30.00; this represented 20.06% of the week’ traded value.

BONDS

The Bond Market recorded reduced activity during the week with bonds worth Sh13.3Bn transacted compared to Sh18.7Bn posted the previous week.