Longhorn’s minority investors shoot down plan to sell head office
What you need to know:
- Longhorn had planned to raise at least Sh500 million by disposing of the land and property in Nairobi’s Industrial in six to 12 months.
Longhorn Publishers has stopped the sale of its head office following protests from activist minority shareholders.
The Nairobi Securities Exchange-listed firm had planned to raise at least Sh500 million by disposing of the land and property along Funzi Road in Nairobi’s Industrial in six to 12 months.
The matter formed part of the agenda items at the annual general meeting held last Friday, but was shot down by acclamation, with major shareholders apparently acceding to the wishes of retail investors.
“It was resolved by more than three-fourths majority not to pass the resolutions in relation to the sale of the company’s property known as LR 209/5604,” the publisher said in a filing to the regulators on the outcome of the shareholders’ meeting.
Rejection of the proposed sale marks a rare blocking of a general or special resolution in NSE-listed companies where AGMs are usually more of formalities confirming decisions originated and backed by major shareholders.
Longhorn’s major shareholders appeared not to have insisted on the matter being put to a vote, in which case they would have carried the day.
Failure to vote on the issue is also an indication the top shareholders are happy to suspend the proposed transaction.
Investment firm Centum is the controlling shareholder in Longhorn, with its 60.2 per cent stake enough to resolve any contentious issue.
Longhorn’s chairman Francis Nyammo is the second-largest shareholder with an 18.73 per cent stake in the company.
Rejection of the property sale is seen as arising from concerns that the transaction would have whittled down the publisher’s hard assets.
Chief executive Simon Ngigi recently told Business Daily that the sale was informed by the need to increase investments in more high-return publishing fields, adding that Longhorn had planned to rent space in an alternative location.
The firm would have booked large gain in the scuttled transaction, having invested Sh155.4 million to build the headquarters.
