Troubled investment firm, TransCentury has announced plans to delist from the Nairobi Security Exchange following years of losses and now the ongoing impacts of the Corona virus pandemic.
A decade ago, the Nairobi Security Exchange (NSE) listed firm was a vibrant entity that attracted investors due to its profitability.
However, the company has now reached a dead end and it plans to delist all the issued ordinary shares of the Company.
The shares comprise 375,202,766 shares of par value Ksh 0.50 each which shall be de-listed from the official list of the alternative investment market segment of the NSE.
At its peak, the share price of the Nairobi Securities Exchange (NSE)-listed company traded at a high of Ksh 60 a few days after it started trading at the bourse in 2011.
Today, the stock has since nose-dived incurring losses of billions of shillings on shareholders wealth, atleast on paper value.
Lenders who had extended credit facilities to the firm could also lose immensely as the company’s profits continue to dip.
In a cautionery statement, the firm has warned it’s shareholders and the investing public to exercise caution when dealing with shares of the company.
” We are advising shareholders and the investing public that TC has commenced a process that may result in material changes in the Company’s listing status,” said the cautionery statement.
The completion of the process is subject to regulatory and shareholder approvals.
” A detailed announcement including all relevant information on the proposed process will be made available on the Company’s website www.transcentury.co.ke at the appropriate time.”
In 2004, when stock market was enjoying a boom, TransCentury shares of NSE-listed East African Cables shot from Ksh 12 to an all time high of Ksh 614.
Following the abrupt rise in share prices, shareholders approved a share-split in 2006 of 10 to 1 adding more cash to the company.
However despite the company’s heavy investment in several businesses in the region, the company has failed to make profits and stay a float due to bad credits and poor investment decisions that has brought it to it’s knees.
The company bought it’s first minority stake in Castle Brewery Kenya Limited, a local subsidiary of South African Breweries (SABL), that was meant to compete with Kenya Brewery but the investment failed to break even.
Later, SABL agreed in a board room deal to shut down it’s subsidiary bin Thika and leave East Africa Breweries Limited to sell SABL brands under licence.
Shortly after the share split the company decided to buy a stake in Rift Valley Railway as part of Sheltam Railways, a consortium led by a South African, Mr Roy Puffet which later proved to be one of the company’s biggest blunder.
Though the company had managed to weather some of financial turbulence, it continued to struggle to keep a float.
In 2016, TransCentury faced a credit crunch amid bad publicity as it came under pressure to repay Ksh 8 billion bond.
The company will hold a virtual (Extraordinary General Meeting) on 30th, July to obtain an authority from shareholders to approve and/or ratify delisting from the NSE.