Trade in East African Portland blocked for 60 days

Kenya's Capital Market Authority (CMA) has imposed a 60-day trading ban on the already suspended shares of East African Portland Cement (EAPCC) to protect investors from a dispute between its board and the government.

Also read: Fund backtracks in EAPCC share transfer saga

The Nairobi Securities Exchange (NSE) halted trading in the company's shares on Dec. 27 after the government, which owns 25 percent of the cement maker, dissolved the board, citing an improper tendering process for clinker -- a lumpy intermediate product in the production of cement.

The High Court later ruled that the government had no power to order the board's dissolution, paving the way for the board's reinstatement earlier this month.

"The authority has set down an initial suspension period of 60 days to allow EAPCC to address all outstanding concerns on compliance with the regulatory obligations imposed on listed companies," CMA Chairman Kung'u Gatabaki told reporters.

"We want to restore confidence in the capital markets," he said.

EAPCC is the second company listed on the Kenyan stock exchange to be suspended in less than six months over governance and compliance issues.

Car retailer CMC Holdings was suspended in September 2011 following fraud claims involving its former chairman.

Gatabaki said a forensic audit was still being conducted into CMC Holdings, which remains suspended from the exchange.