Eyes on Rea Vipingo buyout case as 2 join Capital Markets Authority panel
A sisal estate in Kilifi County. Rea Vipingo runs two sisal estates in Kenya, with an annual production capacity of about 12,000 tonnes. It also operates three estates in Tanzania, producing more than 7,500 tonnes a year. FILE PHOTO |
What you need to know:
- Lack of a quorum in the capital markets tribunal has delayed the hearing of Centum’s application.
- REA Vipingo runs two sisal estates in Kenya, with an annual production capacity of about 12,000 tonnes.
- It also operates three estates in Tanzania, producing more than 7,500 tonnes a year.
An appeal by investment firm Centum against a rival offer in its bid to buy Rea Vipingo Plantations can now be determined, following the appointment of new members of the Capital Markets Tribunal.
Treasury Cabinet Secretary Henry Rotich announced the appointment of Karen Kandie and Laila Macharia to the tribunal on Friday, giving it the quorum required to hear and determine cases.
“The Cabinet Secretary of the National Treasury appoints Karen N. Kandie and Laila Macharia to be members of the Capital Markets Tribunal, for a period of three (3) years, with effect from June 3, 2014,” a notice in the Kenya Gazette reads.
Lack of a quorum in the capital markets tribunal has delayed the hearing of Centum’s application and dragged the transaction that was initially set to be concluded by June.
High Court judge Weldon Korir in June directed that the transaction be suspended in the interest of justice until Centum’s application is heard and determined.
In the case, Centum is challenging the validity of an offer by British firm Rea Trading for the 43 per cent of Rea Vipingo it doesn’t already own. Centum has also submitted its bid for the Nairobi Securities Exchange-listed agricultural firm.
OFFER 'IN VIOLATION' OF REGULATIONS
In its submissions, Centum said that Rea Trading’s offer was in violation of the domestic takeover regulations under the Companies Act since it depended on conditions that are yet to be fulfilled.
Rea Trading was offering Rea Vipingo shareholders Sh70 for every share held in the company, with a promise that those who accepted the offer would be entitled to a pro-rata share of dividends or distributions of proceeds from potential future sale of land — for as much as Sh15 per share.
Centum was offering Sh75 for every share held in the sisal firm.
Meanwhile, the Court of Appeal dismissed with costs an application by Vania Investment Pool to overturn a ruling of the High Court on April 17 that disqualified it from the takeover bid.
Vania Investment Pool, a Kenyan company, was disqualified by the capital markets regulator for failing to meet the set February 28 deadline.
Rea Vipingo runs two sisal estates in Kenya, with an annual production capacity of about 12,000 tonnes. It also operates three estates in Tanzania, producing more than 7,500 tonnes a year. The company was suspended from trading on the NSE after REA Trading made a cash offer to acquire it in November.
