Money Markets
People walk past Equity Bank, City Hall branch, in Nairobi. Helios has
been the largest shareholder of the bank since 2007 when it acquired a
24.45pc stake at over Ksh11 billion. PHOTO | FILE
By GEORGE NGIGI, gngige@ke.nationmedia.com
In Summary
- Helios EB Investors sold 2.44 per cent of shares to the Uganda pension fund at Sh4.5bn, cutting its stake in the bank to 9.78 per cent.
- The deal puts NSSF Uganda on the list of top 10 shareholders of the bank and could see it push for representation on the board.
- NSSF Uganda was holding a stake estimated to be worth Sh100 million (Ush3.1 billion) as at the end of last year.
London-based investment fund Helios EB Investors is no longer the single largest shareholder at Equity Bank after selling part of its stake to Uganda National Social Security Fund.
Helios sold 2.44 per cent of its ownership to the pension
fund at Sh4.5 billion, cutting its stake in the bank to 9.78 per cent
which is lower than the 12.22 per cent held by Norway-based Norfund.
“NSSF Uganda has acquired from Helios a 2.44 per
cent stake in Equity Group at a price of Sh50 per share,” said the
Capital Market Authority in a statement.
The unit price paid by Uganda’s pension fund is higher than the current market price of Sh46 a share.
“Our fair value of the share is Sh47 so the higher
price is just a premium NSSF had to give Helios to get into the
shareholder books,” said Mercyline Gatebi, a research analyst at Genghis
Capital.
She pointed out that investors factored in news
coming from the bank in current market price. The deal puts NSSF Uganda
on the list of top 10 shareholders of the bank and could see it push for
representation on the board. NSSF Uganda was holding a stake estimated
to be worth Sh100 million (Ush3.1 billion) as at the end of last year.
Helios has been the largest shareholder of the bank
since 2007 when it acquired a 24.45 per cent stake at more than Sh11
billion.
At the close of last year it sold half its
ownership, 12.22 per cent, to a company owned by two private funds;
Norfund and NorFinance, at a price Burbidge Capital put at Sh23 billion.
If confirmed, it would mean the firm has so far made Sh16.5 billion
from its initial investment.
Norfund has already occupied a seat at the board of
the group at the expense of Helios, which now has three directors down
from four.
Deepak Malik represents the interests of Norfund at the board after Alykhan Nathoo of Helios exited.
Deepak Malik represents the interests of Norfund at the board after Alykhan Nathoo of Helios exited.
When it made the investment, Helios had stated that
it planned to hold Equity Bank shares for seven years but extended the
period owing to high returns from the lender both in capital gains and
dividend payouts.
Helios invested Sh9.5 billion in Africa Oil
Corporation for a 12.4 per cent stake in May, around the time it sold
some of its Equity Bank shares.
The transaction comes after the Treasury exempted share transactions from capital gains tax.
Equity Bank is currently in an ambitious expansion
drive, estimated to cost over Sh200 billion, with plans to enter 10 new
markets in a decade.
The bank plans to raise Sh140 billion from shareholders through rights issues or from a secondary public offering.
The bank plans to raise Sh140 billion from shareholders through rights issues or from a secondary public offering.
Shareholders who do not participate in capital activities are likely to be diluted.
No comments :
Post a Comment