Businessman Chris Kirubi has for the first time in more than five years bought additional shares in Nairobi bourse- listed investment firm Centum.
Filings with the Capital Markets Authority (CMA) show that the billionaire investor bought 6.6 million shares in Centum between last April and January estimated at about Sh86 million, based on the firm’s average share price of Sh13 a piece.
Mr Kirubi’s increased ownership in Centum came in a period that saw top shareholder ICDC cut its stake in the investment firm to 22.9 per cent from 23.5 per cent after selling 3.6 million shares in the same period.
Mr Kirubi’s move is seen as a vote of confidence in the investment firm which has raced to diversify and reduce the influence of the Nairobi Securities Exchange on its performance in recent years. International House, which is associated with Mr Kirubi, reduced its ownership in Centum to 5.3 million shares from 11.1 million in the period under review.
Centum has a portfolio of over Sh15.4 billion invested across asset classes, from blue chip companies like Nairobi Bottlers, UAP Insurance, and General Motors to prime residential land in Nairobi and unlisted firms.
The investment firm does not pay dividend since it prefers to re-invest profit into the business — making its share movement at the Nairobi bourse a critical tool for investors eyeing capital gains.
The firm paid a dividend of Sh0.40 in 2008 and told investors last year that its strategy of reinvesting profits will go beyond 2014. This means that Mr Kirubi is seeking capital gains in Centum in the medium term.
Its share at the NSE has gained 15.9 per cent over the past three months to the current price of Sh14.5, valuing Mr Kirubi’s direct stake at Sh1.7 billion.
Centum announced a 1.5 per cent growth in net profit to Sh805.6 million in the six months to September as rising interest cost hit income, lifted by the recovery of the Nairobi bourse. The fair value gain in quoted investments rose to Sh275.6 million in the six months compared to a loss of Sh338.9 million, which lifted its investment income to Sh947 million compared to Sh386 million in a similar period a year earlier.
The NSE-20 share index gained 29.5 per cent last year and the bourse has this year seen a number of counters, especially blue chip stocks like East Africa Breweries Limited, BAT, and KCB, hit record highs.
The firm has hinged its performance on the region’s vibrant real estate market and its quest to increase its geographical asset diversification across the business’ multiple asset classes.
Recently, it acquired 45 per cent shareholding in Platcorp Holdings, the holding company of micro-credit organisation Platinum Credit.
Other major shareholders in Centum are Kiruma International with a 4.82 per cent stake and Uganda Securities Exchange (1.49 per cent).
Mr Kirubi has interests in UAP Holdings (9.58 per cent), Haco Tiger Brands (51 per cent), Capital FM, and Kenya Power where he is the largest individual shareholder.