Shareholders of listed infrastructure firm Transcentury Plc have approved a rights issue, primarily aimed at the company raising capital for the operations of the company.
The news of the rights issue which hit markets before close of trading saw the share price of the company shoot up by 9.09% to 1.44 per share at the close of Friday’s trading session on the Nairobi Securities Exchange.
Transcentury which had in July 2020 issued a public notice to voluntarily delist from the exchange, seemed to have made a u-turn and is now seeking funds from shareholders at a rights issue of 5 shares for every 1 held (5:1).
Group Chief Executive Officer Nganga Njiinu had said the company would focused on attracting funding that was aligned to the Group’s strategy, which he believed was unavailable if the firm continues being listed. The rights issue could be a concern to what caused the U-turn and stand of the management of the company.
Trancentury Plc has a consortium of companies, including listed cable makers East African Cables and Kewberg Cables, as well as engineering firm Civicon Kenya, among other firms which could be directly affected by the rights issue.
The firm, which had for a long time been an investment giant and investment attractive on the exchange, had been making deep losses earlier, including a Kes 684.8 million loss in 2018.
The NSE-listed firm had posted a Kes1.4 billion net loss for the half-year period that ended on 30th June 2020 compared to a net profit of Kes 297 million posted in the same period in 2019. The company had attributed the drop to the effects of the COVID-19 pandemic, which the group said disrupted demand and global supply chains.
Other Resolution from Transcentury AGM
The shareholders also approved of the company’s financial statements and also reelection of Mr Shaka Kariuki and Ephraim Kariithi to the board of directors.