Friday, March 29, 2024

Kirubi’s Centum set to make Sh. 1 billion from sale of shares bought at Sh. 12 million only

Billionaire businessman Chris Kirubi’s Centum Investments is set to make an 8,000 per cent gain from the sale of its minority stake in alcohol firm KWAL.

Centum on Tuesday announced that it is selling its 26.43 per cent stake in Kwal to South African brewer Distell in a deal that will see Distell’s ownership rise to a majority 52.43 per cent.

According to the Business Daily, Distell spent Sh. 834 million to acquire its initial 26 per cent stake in Kwal in 2014, indicating that Centum’s divestiture from the alcohol maker will earn it at least Sh. 1 billion, boosting its bottom line.

Centum had spent Sh. 12.2 million to buy the minority stake in Kwal in 1977. “Going by the last transaction details, we estimate the additional stake to be acquired by Distell could be valued at between Sh800 million and Sh1 billion,” Standard Investment Bank (SIB) said in a brief to investors.

Centum is currently involved in strategic divestiture moves in companies where it holds minority stakes.

In 2015, Centum earned Sh5.2 billion from the sale of its 13 per cent stake in UAP Holdings to Old Mutual, making a gain of Sh2.8 billion over the book value of the stock.

Last year, the firm booked a Sh1 billion gain from the sale of its 21.5 per cent stake in insurance brokerage AON.

 

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