Equity Bank chairman’s firm makes play for 23.3% stake in Britam

A company associated with Equity Bank chairman Peter Munga has made an offer to acquire a 23.34 percent stake in financial services firm Britam Holdings.

Plum LLP intends to acquire 452.5 million shares previously owned by Mauritius businessman Dawood Rawat. The shares were seized by the Mauritius government in April 2015, when it emerged Mr Rawat ran a ponzi like scheme in the country that had cheated citizens out of their hard earned cash.

Plum holdings is jointly owned by Mr Munga, Filimbi Limited (an investment vehicle associated with Equity Bank CEO James Mwangi), and Equity Holdings. All three companies have a stake in Britam.

With the proposed acquisition, Plum and its associates will jointly own 38.54 percent of the financial services firm, making them the majority shareholders.

“on completion of the proposed acquisition, the proposed offer or (plum) together with associated persons and related companies will control 747 million ordinary shares…… comprising of 38.45% of the total issued ordinary shares of Britam,” Mr Munga said in a notice to shareholders.

Britam’s shares have taken a nose dive since the news of Mr Rawatt emerged plummeting from Sh28 in April 2015 to Monday’s trading price of Sh13.55. Plum Holdings has not indicated how much it would be offering for the shares, but on current share valuation would pay Sh6.1 billion for the shares.

The investment company has at the same time sought for exemption from the Capital Markets Authority from taking over Britam. Under the takeover and merger regulations, shareholders with between 25 to 50 percent stake in a company have to seek an exemption from the markets regulator if they do not seek to take over the company.

“The proposed acquisition will give Britam and its shareholders the time it needs to identify a strategic investor with the institutional fit to support the company in the future,” the firm said.

The Mauritius government last year indicated it would sell the shares of the disgraced businessman for premium, targeting at least Sh13.3 billion for the shares.