Kengen rights issue opens as it targets Sh29 billion
From left, KenGen Chairman Joshua Choge, Energy CS Charles Keter and KenGen MD Albert Mugo during the launch of the rights issue at the Intercontinental Hotel in Nairobi on May 23, 2016. PHOTO | DIANA NGILA |
What you need to know:
The firm intends to use the Sh8.6 billion cash raised from the issue to finance capital expenditures in geothermal and wind power generation.
NSE-listed power producer Kengen has opened its Sh28.8 billion cash call almost two weeks after the firm got regulatory approval from the Capital Markets Authority (CMA).
Kengen will be selling 4.4 billion new shares at Sh6.55 to its existing shareholders in the ratio of two for each share held.
The rights issue will open for three weeks to close on June 10.
The National Treasury has taken up its rights by converting its loans of Sh20.1 billion equity in the power generator. The government owns 70 per cent of Kengen.
The power generating firm intends to use the Sh8.6 billion cash raised from the issue to finance capital expenditures in geothermal and wind power generation.
Investors willing to participate in the rights issue but are not shareholders can buy rights of owners who are not willing to exercise their option at the securities exchange.
Non-shareholders also have an option of buying the shares that will not be taken up at the end of the rights issue period through what is known as a rump.
Existing shareholders who do not participate in the offer will have their ownership diluted.
Listing and commencement of trading of new shares at the NSE will be on July 6.
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