KenolKobil Ksh.35B bid under investigation by CMA

The Capital Markets Authority has said investigations have been launched into irregular share trades in relation to a takeover offer for KenolKobil by Rubis.

The French fuel storage and distribution company made a takeover offer for KenolKobil earlier on Wednesday that it said valued KenolKobil at Ksh.35billion shillings.

CMA said its market surveillance had identified potentially irregular trading of KenolKobil shares in the run up to the Rubis bid announcement.

“Consequently, in connection with these investigations the Authority has instructed the Central Depository and Settlement Corporation to place a freeze on the suspected accounts to allow for the conduct of the necessary inquiries,” the regulator said in a statement.

The volume of trading in KenolKobil’s shares on the Nairobi stock exchange jumped to 373.46 million on Oct. 23 from 29.51 million a day earlier, according to Refinitiv data.

Rubis, which is active across Europe, Africa and the Caribbean, has purchased nearly a quarter of the shares of KenolKobil on the open market and wants to buy the remaining shares, the companies said in bourse filings.

Rubis has offered to buy them for 23 shillings each, 53.4 percent above their weighted average closing price over the previous 30 days. That values all of KenolKobil at about 35 billion shillings, according to the French company

KenolKobil shares closed at 15.85 shillings on Wednesday, after surging 31 percent to a record high of 21.75 shillings.

“It is a pretty decent offer,” said Eric Musau, a research analyst at Standard Investment Bank.

Rubis said it had struck agreements with two shareholders, including long-serving KenolKobil CEO David Ohana, to buy shares representing 9.69 percent of the company.

Rubis plans to expand parts of the Kenyan business, such as liquefied petroleum gas (LPG), once the deal is concluded.