Companies

Centum sells 2.1m shares of Longhorn Publishers

mworia

Centum CEO James Mworia said sale of Longhorn shares was a normal trade. PHOTO | FILE

Investment firm Centum has sold a 3.65 per cent stake in Longhorn Publishers, marking its first partial divestiture in the firm that was listed in March 2012.

The latest regulatory filings show that Centum’s shareholding in Longhorn dropped to 18.2 million shares or a 31.25 per cent stake in October compared to the 20.4 million shares (34.9 per cent stake) it held previously.

“It was a normal trade as part of our portfolio management,” said James Mworia, Centum’s chief executive.

The 2.1 million shares sold are currently worth Sh21.6 million based on Longhorn’s prevailing stock price of Sh10.1.

The publisher’s share price has declined 27.8 per cent from the Sh14 at which it was listed on the Nairobi Securities Exchange by introduction.

It has declined 25 per cent over the past one year. The two-year lock-in period for its major shareholders, including Centum and Mr Francis Nyammo, expired in April.

The investment firm’s partial sale of Longhorn shares is one of its few recent divestitures.

The company has been increasing its stake in most of its subsidiaries and associates such as the local Coca-Cola bottlers. Other firms where Centum has firmed its grip include K-Rep Bank that is now its controlled subsidiary.

READ: Centum buys majority stake in bottling firm

Mr Mworia said Centum could not disclose whether it plans to further dispose or increase its stake in Longhorn, maintaining that future transactions will be guided by prevailing circumstances.

Longhorn has laid out a growth strategy based on regional expansion through acquisitions and greenfield ventures, with aggressive expansion into the export markets.

The NSE-listed firm says it plans to establish a subsidiary in Rwanda to boost its presence in that market. Longhorn is also developing new titles for the Malawian market where the school curriculum is being reviewed.

The publisher’s net profit rose one per cent to Sh94.9 million in the year ended June.

This came as sales increased 35.1 per cent to Sh1.3 billion, with higher operating and distribution costs eroding its margins.

Longhorn is set to effect a bonus issue of three shares for every two held, a move that will expand the volume of its outstanding shares by 50 per cent to Sh87.7 million units.