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TransCentury’s new PE fund shareholder keeps faith with CEO

TransCentury chief executive Ng’ang’a Njiinu. FILE PHOTO | DIANA NGILA
TransCentury chief executive Ng’ang’a Njiinu. FILE PHOTO | DIANA NGILA 

New York-based private equity (PE) firm Kuramo Capital has kept faith with the acting TransCentury CEO Ng’ang’a Njiinu, confirming him as the chief executive after temporarily holding the post for nine-and-a-half months.

Kuramo, which recently injected Sh2 billion into the investment firm in exchange for a 25 per cent stake, has veto powers on a range of decisions including the hiring and removal of TransCentury’s chief executive and chief financial officer.

The new powerful shareholder has now approved that Mr Njiinu, who has also been serving as the firm’s head of corporate finance, to become the its substantive chief executive.

He took over from Dr Gachao Kiuna who resigned on January 14.

“The board is confident that the company has both the leadership and experience to build on its existing strengths whilst devising new strategies to ensure sustained business growth,” said TransCentury in a statement.

Mr Njiinu joined TransCentury in 2008 and has since then held various roles in corporate finance, portfolio management, business development as well as originating and developing infrastructural opportunities.

He holds an MBA in Finance and Investment Management from the University of Dallas, Texas and a Bachelor of Science in International Business from United States International University in Nairobi.

“The board takes this opportunity to congratulate Mr Njiinu on his appointment,” said TransCentury.

TransCentury allocated Kuramo 70,120 preference shares and 93.7 million ordinary shares (equivalent to a 24.99 per cent stake) in exchange for a Sh2 billion investment.

The NSE-listed firm sought the investment from Kuramo to help retire the Sh8 billion bond it issued in 2011 and which was due in March, piling pressure on the firm’s owners.

Kuramo also has veto powers decisions on the CEO’s compensation, sale of assets and issuance of new shares.

It must also give its approval of any business plan, loans to directors exceeding Sh1 million and initiation or settlement of lawsuits with a value exceeding five per cent of the company’s total assets.

Mr Njiinu will have to work within Kuramo’s bounds given its sweeping powers. He is taking charge of TransCentury at a time when its revenues for the half year to June dropped by a quarter to Sh4.1 billion.

The drop in sales was cushioned by a Sh4 billion debt forgiveness (part of the convertible bond) which helped the firm record a Sh1.3 billion net profit, an improvement from last year’s Sh676.1 million loss.

TransCentury has projected improved performance in the second half of the year.

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