Finance Cabinet Secretary John Mbadi disclosed that Kenyan retail investors and domestic institutions acquired 7.9 billion shares during the recently completed Kenya Pipeline Company (KPC) Initial Public Offering.
The finance minister noted that neighboring countries, particularly Uganda and Rwanda, participated substantially in the offering, enabling the government to collect Ksh106.7 billion from the share distribution.
During the IPO which offered 12.4 billion shares at Ksh9 apiece, Uganda, Rwanda and other East African Community nations jointly obtained 3.8 billion shares.
Rwanda reportedly acquired its stake through the nation’s pension funds, coinciding with Kenya’s recent announcement to monetize and utilize employee National Social Security Fund (NSSF) contributions for comparable diversification goals.
Mbadi rejected assertions that the shares were overvalued, stating that unidentified parties were attempting to undermine the proceedings.
He mentioned that the administration had to turn down certain applications because of excessive demand, including proposals from East African Community member countries like Uganda.
Notwithstanding the significant regional interest, the administration will maintain a 35% controlling interest in KPC, whereas the East African Community bloc will now possess a 21.22% stake, corresponding to the 3.8 billion shares obtained.
Kenyan retail investors and domestic institutions purchased 7.95 billion shares from the IPO, representing approximately 67.32% of the total shares available.
‘We made available 11,812,644,350 shares at 9 shillings per share. The total number of shares requested reached 12,486,78,724, resulting in an overall subscription rate of 105.7%,’ the CS stated at the IPO results announcement on Wednesday.
Foreign investors, who are eventually expected to receive full ownership of KPC, will now hold a minimal 0.02% stake in the corporation.
Under the final distribution arrangement, local institutional investors will command 41%, retail investors 2.56%, KPC employees 0.06%, and licensed petroleum marketing firms in Kenya 0.041%, summing up to 100% ownership.
KPC listed on the stock exchange on March 9, becoming the fifth company on the current trading board.
Regarding concerns that the proposed National Investment Fund (NIF), which was intended to receive a portion of the proceeds, has not yet been established, Mbadi explained that the funds would initially be placed in the Consolidated Fund before being allocated through parliamentary approval.