The government is set to unlock at least Sh999.1 million from the sale of its shareholding in six listed companies following approval of the planned transactions by the Cabinet on Tuesday.
The Cabinet on okayed the divestiture in East African Portland Cement (EAPCC), Nairobi Securities Exchange (NSE), Stanbic Holding and Housing Finance, Liberty Holdings, and Eveready.
According NSE data, the State shareholding in the six entities was valued just shy of Sh1 billion as of Tuesday with about half of the value or Sh500 million representing the government’s 1.1 per cent ownership in Stanbic Holdings.
The government’s 52.3 per cent shareholding in EAPCC is meanwhile valued at a lesser Sh334.1 million based on the company’s share price of Sh7.10.
The value of government shareholding in the four other companies is, meanwhile, lower at Sh53.5 million for the NSE, Sh40.8 million for the Housing Finance Group, Sh43.3 million for Eveready East Africa, and Sh27 million for Liberty Holdings.
The shares sale is expected to be conducted via trades at the bourse where the government is widely expected to hire transaction advisors to guide the process.
“Once you have an advisor in place, they would advise on the methodology of sale which could likely be an auction,” noted Mr Eric Musau, the executive director for Research and Sustainable Finance at Standard Investment Bank (SIB).
The government divestiture from EAPCC is widely expected to end a tug-of-war between the State and Lafarge which holds a 41 per cent stake in the cement maker via various entities including Bamburi Cement.
In recent years, the government has pressured the French conglomerate to dilute its interest in the company on anti-trust laws.
Lafarge has, for instance, been accused of sabotaging EAPCC to protect its interest in rival Bamburi in which it holds a 58.9 per cent stake.
The sale of government shareholding in the other five companies is not expected to widely result in drastic changes to their ownership structures.
