KenolKobil share falls by 9pc on high investor sales

KenolKobil’s share dropped by 9.5 per cent in Thursday’s trading even as transaction advisors for its ongoing buy-out deal denied speculation that negotiations had stalled.

The oil marketer’s shares closed at Sh13.35 per share from the previous day’s average of Sh14.75, with 1.5 million shares changing hands.

“KenolKobil slipped to a three month low of Sh13.35 following speculation earlier in the session that its take-over negotiations with Puma Energy were having some challenges and the deal could be terminated. The transaction advisors have, however, indicated that the deal has not been terminated and negotiations are still ongoing,” said Standard Investment Bank in its daily market report.

Kestrel Capital are the transaction advisors for the deal.

KenolKobil had early this year announced that it had entered into buyout talks with Swiss-based Puma Energy.

READ: KenolKobil top shareholders to sell stakes to Swiss oil giant

On Wednesday, some media reports casted doubts on the buyers’ readiness to go on with the deal. Kenolkobil is currently involved in several court battles and rival oil dealer, Shell, has also laid claim to holding prerogative powers of a buyout.

Puma International, which had in the past said it was conducting due diligence on the oil company, was to buy out shareholders of the Nairobi Stock Exchange (NSE) listed firm.

Foreign investors chose to stay off the counter with locals constituting 96 per cent of the buys while also being 75 per cent sellers.

Kenolkobil has outperformed the market having grown its investors funds by 48.2 per cent from the beginning of the year at a time when the NSE 20-Share Index has risen by 25.4 per cent.

Thursday, the index held at 4,031 points overcoming a previous downward slide at the beginning of the week that had seen it nearly drop below the 4,000 points mark.

Other top movers of the day included Safaricom which saw 38.4 million shares change hands. Despite the high volumes the telecommunication company’s shares continued to trade above the IPO price, closing at Sh5.05, boosted by huge foreign investor’s appetite.

East African Breweries Limited also gained to close at an average Sh259 compared to previous trading price of Sh257, to see it hold on to the top position of the most capitalised firm at the bourse ahead of Safaricom.

The gain of the two large companies saw the market’s total capitalisation rise to Sh1.24 trillion. Other gainers included Standard Group, up six per cent, KCB by 3.6 per cent and CFC Insurance up 3.1 per cent.