Centum Investment Company Plc shareholders’ are set to vote on the firm’s planned share buyback plan following the board’s approval.
The voting will take place during an Extraordinary General Meeting (EGM) set to be held via electronic means on February 3.
The share buyback is intended to provide liquidity for owners of the dual-listed firm as well as reward long-term shareholders of the company whose proportionate holding will increase as a result of the share repurchase.
Up to 10 percent of the firm’s issued and paid up share capital will be eligible for repurchase by the company at a maximum price of Sh9.03 per share and a minimum offer price of Sh0.50 per share in accordance with the Capital Markets Authority (CMA) Guidelines.
The capital markets regulator has allowed Centum to complete the share buyback within 18 months.
Centum has been exempted from the limit under trading Guidelines to purchase no more than 25 percent of the average daily trading volume for the four calendar weeks preceding the date of purchase.
The Company’s shares at the current prices are deeply discounted relative to Net Asset Value per Share.Its share price is down by 44 per cent year-to-date trading at Sh8.60 on Thursday.
“The share buyback is also expected to provide liquidity to shareholders who may not have been able to trade due to the current depressed market conditions,” added Mworia.
Centum has appointed Faida Investment Bank to act as advisors for the Buyback Programme.
The share buyback is expected to enable the company achieve alignment of shareholding to the long term value objectives of the company by offering an opportunity to those investors who may wish to cash out while reward those who wish to remain as shareholders.