Money Markets
Mr Edward Burbidge, chief executive Burbidge Capital Ltd (left), with Flame Tree CEO Heril Bangera. Photo/Courtesy
By John Gachiri, jgachiri@ke.nationmedia.com
In Summary
- Flame Tree Group plans to list on the NSE’s Growth Enterprise Market Segment (Gems) in the last quarter of this year.
- ARM Cement was the last family-owned manufacturer to list at the NSE in 1997.
- NIC Bank, telco Access Kenya (which delisted last year) and media firm Scangroup joined the bourse much later.
Flame Tree Group, a family-owned manufacturing
concern, plans to list on the Nairobi Securities Exchange (NSE) making
it the only such listing in 17 years.
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The firm, whose brands include Roto tanks and Zoe brand of
cosmetics, plans to list on the NSE’s Growth Enterprise Market Segment
(Gems) in the last quarter of this year. Both brands enjoy high
visibility in the water storage and beauty industries respectively.
ARM Cement was the last family-owned manufacturer to list at the NSE in 1997. NIC Bank, telco Access Kenya (which delisted last year) and media firm Scangroup joined the bourse much later.
The company said the listing is meant to give it
access to the capital markets which offers more affordable funding,
either through debt or equity, required to fuel future growth.
Flame Tree chief executive and founder Heril
Bangera said the listing on the less restrictive Gems will also unlock
value for present and future shareholders.
“We are committed to offering value to our future
shareholders from the start and sharing with them the financial and
social benefits of creating a pan African Group,” said Mr Bangera in a
statement.
The manufacturer has appointed Burbidge Capital the
nominated advisors, Viva Africa the structuring consultant, PKF as
reporting accountants while Coulson Harney will handle the legal work.
Flame Tree has three divisions spread across
manufacturing of plastic goods, fast moving consumer goods (FMCG) while
the other is a trading company.
The manufacturer operates in Rwanda, Ethiopia,
Mozambique, DRC, Burundi and Sudan and as at the end of 2013 had
revenues of around Sh2.2 billion.
Flame Tree said the expansion bid is driven by the growing middle class that has created a large market for consumer goods.
The company that was founded 25 years ago becomes
the second family-owned firm to announce that it plans to list on the
Gems this year.
Mayfox Mining, which is prospecting for gold in
Turkana County, announced in March that it would list by the end of the
year. Mayfox is majority owned by the Manga Mugwe family through Mayfox
Mining Mauritius Ltd.
Like Flame Tree, May Fox also plans to use its
listing on the Gems to raise additional capital in the future. The
transaction advisors said the listing of Flame Tree should usher more
such companies at the exchange.
“The Flame Tree Group listing is intended to be a
win-win for existing and new shareholders alike. We believe this will
also propel the Gems market forward and contribute to the future growth
of the local capital markets,” said Burbidge Capital chief executive
Edward Burbidge
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