Centum, an investment company, will seek shareholder approval to buy back 10% of its listed shares at an extraordinary general meeting on February 3.
The business hopes to gain shareholder approval at the meeting before launching the repurchase program on February 6 and lasting 18 months until August 8, 2024.
Centum intends to repurchase 66.5 million shares on the open market at a price ranging from 50 cents to Sh9.03, with the buyback price being the volume-weighted average price of the company’s shares in the 30 days before the share buyback’s board approval.
In Thursday’s trading session, the company’s share price finished at Sh8.5, 10.39 per cent higher than the 52-week low of Sh7.7 recorded on November 24, 2022.
The share repurchase program is accessible to all shareholders, regardless of share size, however, there is a maximum buyback size.
The Nairobi Securities Exchange-listed firm told shareholders the programme would provide them with cash/liquidity and improve future earnings and gains from a higher share price.
“The company is proposing a buyback of up to 10 percent of its listed ordinary shares to offer the company’s shareholders partial liquidity of their shareholding at the prevailing market price while retaining optionality to benefit from potential improvement in future earnings and capital gains. As the demand and supply of the company’s shares balance out during the buyback period, it is expected that the market price will adjust accordingly to better reflect the fair value of the company’s ordinary shares,” said Centum in a statement.
The board of the company has reserved the right to terminate the buyback on conditions including when the programme is no longer deemed to be in the best interest of the company and shareholders, changes to economic and market conditions and in the incidence of a material change in the firm’s financial position.
Centum’s floating shares will be reduced to 598.9 million if the share repurchase is effective. The Capital Markets Authority has already granted regulatory permission for the share buyback (CMA).
https://www.centum.co.ke/images/docs/Shareholder_Circular_Centum_Share_Buyback_Program.pdf
