AccessKenya stirs speculation with AGM push-back

AccessKenya directors, Mr Jonathan Somen (right) and Mr David Somen. Photo/FILE

Internet firm AccessKenya has postponed its annual general meeting set for Tuesday, throwing shareholders into confusion.

The postponement, in a brief Press notice on Friday, indicated that the firm had pushed forward its shareholder meeting to August 31 and closing of its register to September 1.

Business Daily could not establish immediately what the nature of the logistical hiccup was, but financial analysts said that its could signal the firm is facing cash-flow problems or it has a material announcement that it seeks to make ahead of the AGM.

Efforts to get the finer details behind the postponement proved futile as the firm’s spokesperson, Ms Nancy Imunde, refused to comment on the issue and referred us to the Press notice.

Mr Jonathan Somen, the firm’s managing director was said to be out of office.

“AccessKenya’s announcement implies the firm may be experiencing some cashflow issues or it could be expecting a significant corporate action that has necessitated a delay in their AGM,” said Mr Alex Muiruri a Research Analyst at Faida Investment Bank.

According to the Company Act of Kenya (Cap 486) a listed firm is supposed to hold its AGM within fifteen months of the previous one.

Last year AccessKenya held its AGM on June 18, 2009 and a resolution by its board to postpone this year’s AGM from May to end of August 2010 is within the fifteen months rule set in the Company’s Act.

This postponement to close AccessKenya’s register thus means that dividend payment’s will also have to take longer, as the process requires approval by shareholders during the AGM and that the register is closed before payment to respective shareholders is effected.

Last year, the firm paid Sh82 million in dividends with each share attracting Sh0.40.

In their published financial statements for the full year ended December 31, 2009, AccessKenya indicated a negative cashflow of Sh98 million, down from a positive cashflow position of Sh109 million at the end of the previous year.

“Investment was very high this year (2009) as projects were completed on the Wimax network and TEAMs and metropolitan fibre were rolled out. Our capital expenditure requirements should fall significantly in 2010,” indicates a commentary on the firm’s cashflow position in the groups audited statements for the financial year 2009.

AccessKenya shares at the NSE have remained stagnant, dropping 1.5 per cent since the year began to stand at Sh19.70 per share, despite the market showing increased buoyancy with the NSE-20 share index rising 30.4 per cent from 3,247 points to 4,233 points since the start of the year.

The postponement of the AGM comes barely weeks after two of the firm’s directors — Eddy Njoroge (managing director of KenGen) and Ngugi Kiuna (a director at TransCentury) exited from the board.

Mr Kiuna left the board on March 19 and Mr Njoroge resigned on March 26.

AccessKenya was run by the Somen brothers as a family entity before listing at the Nairobi Stock Exchange (NSE) in 2007.

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