Recently, a directive from the Trade, Industry and Cooperation Committee of the Kenyan Parliament put a brake on the acquisition of Tanzanian tycoon Munif, who was determined to win. According to the original plan, Munif will take over 26.32 million shares of Portland East Africa, accounting for 29.2% of the shares, from Swiss holcim at a price of 27.30 shillings per share, totaling about 719 million Kenyan shillings. However, the price was only 46% of the closing price of 58.50 shillings on September 16, which was pointed out by parliamentarians as a "half-discount sale of state-owned assets". Parashina, a member of
the Kajadonan constituency, questioned the company's management in public at the hearing. He questioned the board's willingness to allow foreign investors to take core assets at a low price, but not to use its own funds to buy them back and put them back on the market at a fair price in the future. In the face of questioning, othman, general manager of Portland, east Africa, admitted that the company had abundant cash flow and could start repurchasing as long as the capital market authority nodded, and revealed that holcim was withdrawing from sub-Saharan Africa in an all-round way, and that repurchasing was the preferred option. Portland,
East Africa, has soared 385% on the Nairobi Stock Exchange in the past 12 months, 55% in the past six months, and broke through 59 shillings on September 17, making it the most eye-catching stock on the exchange. However, members pointed out that the market value of the company was only 5.5 billion shillings, while the audited net assets were as high as 20.4 billion, with a land reserve worth more than 21 billion, which was "significantly lower than reasonable value", and that the external controlling party should not be introduced at a discount price at this time.
Despite parliamentary pressure, the chief executive of the Capital Markets Authority, Shamaha, responded that regulators could only ensure compliance with information disclosure and had no power to force both sides of the transaction to adjust voluntary prices. The Competition Authority has also been asked to intervene, but no decision has been made.
If the transaction is completed, Munif will become the single largest shareholder in Portland, East Africa, with a 41.75% stake. Earlier, its Amson Group had just completed its holding acquisition of Banbury Cement for 23.2 billion shillings and issued a compulsory extrusion notice to the remaining minority shareholders, offering 65 shillings per share. Bamburi himself already owns 12.5% of Portland in east Africa, and once holcim's stake goes to munif, the Tanzanian businessman will control both of Kenya's cement giants.
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