TransCentury cedes half of board positions to PE firm
Transcentury board chairman Zephaniah Mbugua (right) with CEO Nganga Njiinu (left) during a past annual general meeting on June 30, 2016. FILE PHOTO | DIANA NGILA | NMG
A year ago, Kuramo injected $20 million into the infrastructure firm to help it settle a Sh8 billion bond that was maturing.
TransCentury has now announced that the transaction has received all the statutory and regulatory approvals, and that the new shares shall be allotted to Kuramo.
The transaction will see the combined stake of the firm's top founder shareholders drop to 35pc as Kuramo becomes single largest investor in the firm.
New York-based private equity firm Kuramo Capital has taken half of the board positions at investment firm TransCentury following the acquisition of a 25 per cent stake in the company.
Kuramo’s investment of Sh2 billion in the Nairobi Securities Exchange-listed firm has earned it three non-executive director positions on the six-member board.
Shaka Kariuki, Kuramo’s co-chief executive officer, Wale Adeosun (chief investment officer) and Kamal Pallan (chief operating officer) are now part of the team directing TransCentury’s strategy. “The board is pleased to announce the appointment of… three non-executive directors with immediate effect,” TransCentury said in a statement.
Zephania Mbugua (TransCentury’s chairman), Ng’ang’a Njiinu (the firm’s chief executive) and Dennis Awori complete the list of directors of the company.
TransCentury’s board has traditionally consisted of seven members.
Founder members including former Kenya Revenue Authority boss Michael Waweru, businessman Robin Kimotho and Kenya Tea Development Agency chairman Peter Kanyago retired from the board mid last year. Carol Musyoka, a corporate consultant, quit in 2015. The new Kuramo directors hold a wide range of powers including the right to veto decisions such as hiring and removal of TransCentury’s chief executive and chief financial officer.
Kuramo also has veto powers on matters like the CEO’s compensation, sale of assets and issuance of new shares. The PE fund must also give its approval of any business plan, loans to directors exceeding Sh1 million and initiation or settlement of lawsuits with a value exceeding five per cent of the company’s total assets.
Kuramo’s board representatives were unveiled as TransCentury announced that the US firm will be allotted 93.7 million ordinary shares with effect from April 3 following receipt of all the statutory and regulatory approvals.
