Bamburi Cement’s share price has fallen 21.5 percent below the price offered by Tanzanian conglomerate Amsons Group, in its bid for the company, widening the foregone gains for shareholders who have opted not to participate in the offer.
Amsons, which was left as the sole bidder for the cement firm after the withdrawal of Kenyan firm Savannah Clinker last week, will pay those taking up its offer at Sh65 per share.
Meanwhile, the share closed trading yesterday at Sh51, the lowest since July 10, the day Amsons first disclosed its takeover bid. On July 10 the Bamburi stock traded at Sh45 per share.
In the intervening period, the Bamburi stock touched a high of Sh82—on September 16— spurred by a special dividend and the bidding war between Amsons and Savannah which saw the latter raise its offer price from Sh70 to Sh76.55 before last week’s withdrawal.
Bamburi distributed a special dividend of Sh18.25 per share at the end of September from the proceeds of the sale of its entire stake in Uganda’s Hima Cement earlier this year.
The Amsons offer closed on December 5, a day after Savannah’s offer was terminated after doubts emerged about its financing. The stock was suspended from trading on December 6 for reconciliation of records.
Upon resumption of trading on Monday, the share shed 9.7 percent, adding to the 6.6 percent it lost on Thursday when the takeover offer closed.
Amsons committed to buying all the shares for which it received acceptance forms, with the results of the bid set to be published by December 20. In its bid documents, Amsons said that KCB Bank Kenya —its principal banker— provided an irrevocable bank guarantee for the full Sh23.6 billion it needs to finance its offer.
Those snubbing its offer, or who were unable to switch from the Savannah bid and tender their shares to the Tanzanian firms, now risk remaining as minority investors in a company that could eventually be delisted from the Nairobi Securities Exchange (NSE) depending on the uptake of the offer.
Amsons’ offer document stated that the company would evaluate the efficacy of continued listing, should it achieve acceptances of 75 percent or more of the offer shares.
A 90 percent acceptance rate would give Amsons the option of compulsory buyout of the non-accepting shareholders, making it easier to delist the company.
Those holding minority shares would also lose the liquidity provided by the company being on the NSE, if it ends up being delisted.
Amsons Group, which has interests in the cement, fuel and transport sectors, is controlled by Tanzanian businessman Edhah Abdallah Munif, with minority stakes in various subsidiaries held by other members of his family.
