Carbacids offer for BOC opens amidst pushback on price

Carbacid Investments offer to acquire BOC Kenya (BOCK) has opened without amendments to its valuation of the company.

Carbacid alongside its Aksaya Investments has made a bid for the 100 per cent issued share capital of BOC Kenya for a total of Ksh.1.24 billion or an equivalent Ksh63.50 per share.

The lack of improvements to the offer is however seen dampening the transaction with an independent advisory opinion by Dyler and Blair Investment Bank pricing Carbacid at a higher Ksh.91.76 a share.

“The offer is not considered to be fair and reasonable by definition,” Dyler & Blair stated.

Carbacid has countered the independent advisory with Chairman Dennis Awori terming the offer price at a premium as he expects his firm to secure a significant number of shares from minority shareholders.

“The Carbacid offer to acquire BOC Kenya is off to a good start with a positive response this far. We firmly believe that the offer is fair and represents a realistic underlying value of BOC Kenya and one that will allow us to invest in the rejuvenation of the company in coming months,”.

Subsequent to its independent advisory on the transaction last month, BOC failed to recommend the offer to its shareholders after the significant difference in valuation.

Nevertheless, Carbacid’s offer has the backing of UK based BOC Holdings which has a stake of 65.38 per cent stake in BOCK.

Carbacid will hope to book enough acceptances to close out the deal ahead of the close of the offer period on April 6.

With three quarters of the stake booked through the commitment by BOC Holdings, the firm will be eyeing to tap at least 24.7 per cent of the stake held by minority investors after which it can trigger a mandatory takeover of the company.

“We encourage BOCK shareholders to freely and independently decide whether to accept our offer or chose to remain shareholders. We are also actively encouraging the shareholders to review the terms as per the offer document to fully appreciate our rationale in more detail,” added Awori.

Carbacid is eyeing to become the region’s largest manufacturer and distributor of industrial gases through the transaction which further awaits requisite approvals by the Capital Markets Authority (CMA) and the Competition Authority of Kenya (CAK).