Somens get boost as AccessKenya rises above IPO price in two years

What you need to know:

The Internet services firm’s share closed the week at Sh10.05 — which is slightly above the IPO price of Sh10.
The share turnaround has been linked to AccessKenya’s announcement of the first dividend payment in three years.

The Somen family, the anchor shareholder in Internet firm AccessKenya, has got a boost after the firm’s share rose above the IPO price for the first time since February 2011 on improved performance.

The Internet services firm’s share closed the week at Sh10.05 — which is slightly above the IPO price of Sh10 — and it has gained 95 per cent over the past three months, making it the best performing share at the Nairobi bourse over the period.

The share turnaround has been linked to AccessKenya’s announcement of the first dividend payment in three years after its net profit rose 38.8 per cent to Sh151.3 million in the year to December.

The Somen family, who brought the Internet firm to the Nairobi Securities Exchange in 2007 through an IPO, has been at pains to explain to shareholders that the share price was not reflective of the firm’s financial status.

Analysts at the Standard Investment Bank say investors are keen to be on firm’s shareholder register ahead of May 30, the last day to qualify for the Sh0.30 dividend.

The firm paid a dividend of Sh0.30 in 2009 and Sh0.50 in 2008, with Managing Director Jonathan Somen attributing the rebound to market share growth.

The Communication Commission of Kenya data places AccessKenya’s market share at 16.5 per cent based on subscribers in September, behind Wananchi Group (41.5 per cent). Telkom Kenya’s stake stood at 13.5 per cent and Safaricom at 9.6 per cent.

Rising competitive pressure saw the firm pursue cost-cutting plans over top line growth in the two years to 2011, but signalled a shift in the strategy last year to corporate data sales.

Mr Somen who will become a key beneficiary of the dividend payment firmed his grip as the top owner by increasing his shareholding to 16.96 per cent in November from 16.6 per cent last December and will receive Sh11.1 million in dividends for his stake now worth Sh371.8 million.

The Somen family has in the 18 months to December increased their ownership to 30.26 per cent from 25.3 per cent mid-2011, helped by the Internet service firm’s lower share prices.

The share gain has also doubled the worth of the collective worth of the Somen’s to Sh664 million. The family said earlier it is open to a takeover bid if the price is right.