Monday, December 05, 2005

Hostile takeover?

The number of companies listed at the Nairobi Stock Exchange could reduce by one following a notification on December 1, by BOC Gases of its intention to acquire effective control (80%) of Carbacid Investments. BOC already controls 42% of the Carbacid trhough proxies, and will use a novel technique to finance the deal. BOC has reported six-month turnover of 454 million while Carbacid had 134m for the half year. On Friday there was no activity in both BOC and Carbacid shares whichc remained at 160 and 137 respectively.


Anonymous said...

This is NOT a hostile takeover. I will address the issue in my bold later.

The management & larger shareholders have OK'd this takeover.

NSE does not have an arbitrage market instead the NSE suspended the trading!

If the price offered is high enough then BOC can get the 80%.

The problem is that it needs approval of various shareholders who are non-residents thus harder to get their consent. BOC should request for more time.

Buying 51% is effective control as well as letting BOC consolidate the Carbacid results. The 80% means that BOC has overwhelming support of the Carbacid shareholders thus BOC can tell the CMA that the 20% are either not available e.g. dead, shares in trust, owner doesn't care, time-barred, etc.

I think 80% is a tough barrier coz of logistics thus BOC should have more time.

bankelele said...

kuoasan: Most companies on the NSE appear to have owners who control +70% of company shares, if not outright - thru related companies.


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