Rea Trading Company, owned by two British brothers, has offered to take over all the shares of Nairobi Securities Exchange (NSE) listed Rea Vipingo Plantations.
It is expected to result in the delisting of Rea Vipingo Plantations, which operates sisal farms in Kenya and Tanzania, from the Nairobi bourse.
Rea Trading Company is wholly owned by two British nationals, Richard Robinow, one of the directors of Rea Vipingo Plantations and his brother Jeremy Robinow and already holds 20.57 per cent or 12.34 million shares of the NSE listed firm.
The trading company is also the beneficial owner of another 36.47 per cent or 21.88 million shares which are under London Stock Exchange listed Rea Holdings plc, a nominee of Rea Trading Company.
“Rea Trading Limited (REAT) announces that it intends to make a cash offer to acquire all the issued ordinary shares of Rea Vipingo Plantations Limited not already beneficially owned by and registered in the name of REAT,” said a notice published in local daily newspapers on Thursday.
Rea Trading is offering Sh40 for every share meaning the two British have valued the NSE listed operator of sisal farms at Sh2.4 billion.
Rea Vipingo last traded 168,000 shares on Wednesday at an average price of Sh27.50, a 42.11 per cent gain from Sh19 at the start of this year.
The offer is at a 45.45 per cent premium from Wednesday’s closing price and at more than double the opening price at the beginning of the year.
“Assuming that the takeover offer is declared by REAT to be unconditional in all respects it is the intention of REAT to propose that the shares of Rea Vipingo Plantations be delisted from the Nairobi Securities Exchange in compliance with the regulatory requirements for such a measure,” said the notice.
AccessKenya is in the process of delisting from the Nairobi bourse and CMC Holdings is expected to follow suit if an offer by Al-Futtaim Group is accepted.
At least eight companies have delisted from the NSE for various reasons including takeovers and failure to comply with the bourses rules.
Unilever Kenya delisted in 2009 while paper sack and carton maker East African Packaging Ltd delisted in 2003 after minority shareholders were bought out.
British trading firm African Lakes Corporation delisted in 2003 for not complying with trading rules and Kenya National Mills was taken over in 2002.
Others such as Pearl Dry Cleaners, Lonrho Motors, Theta Group and Regent Undervalued Assets delisted in 2001 after they also failed to comply with trading rules.