MINORITY shareholders of sisal plantation firm, Rea Vipingo, are likely to gain at least Sh42.50 per share plus bonuses in future, thanks to a vicious buyout bidding for the suspended NSE-listed company.
Rea Trading Company, which sparked off the take over battle with a Sh2.4 billion or Sh40 offer per share on November 12, 2013 disclosed yesterday it has almost doubled its earlier offer to Sh4.2 billion or Sh70 a share.
The company, owned by Britons Richard and Jeremy Robinow,control majority 57.04 per cent stake in the 60-million share Rea Vipingo. This means traders who bought shares by the last trading day on November 13 when 168,000 shares traded at an average of Sh27.50 a piece, will receive a premium of 154.5 per cent return if the Robinow brothers' offer is accepted.
The new offer also promises shareholders a pro-rata (equal proportion) share of dividends of proceeds from sale of the 10,000 acre Vipingo estate in Kenya and Tanzania in future.
The earlier Robinows' offer had been countered by Centum, a shareholder with 0.49 per cent, with a bid of Sh3 billion or Sh40 a share on December 3.
Another counter bid of Sh3.3 billion or Sh55 a share came in on December 11 from Bid Investment which on January 30 transferred its proposal to Vania Investment Pool Ltd after ropping in new investors. Only Centum is willing to retain Rea Vipingo at NSE on successful bid.
Regulator, the Capital Markets Authority, set the February 28(last Friday) as deadline for placing bids and counter-bids in a notice on February 5.
It was not clear whether or not Centum and Vania had upped their earlier offers with unconfirmed reports earlier in February indicating both were preparing improved bids. Centum, for example, was rumoured to be preparing a Sh5 billion or Sh83 a share bid.
Richard Robinow, the chair of Rea Trading, said the upward revision of earlier price by 75 per cent was to fully account “for the potential alternative use value of part” of the 10,000 acre Vipingo estate.
Richard said if the bid is successfully, the expansive estate will be developed to realise its full value from alternative use, starting with most suited areas.
“We believe that it is only fair that, to the extent practicable, an appropriate share of whatever premium is realised from sale of this land should go to existing shareholders of Rea Vipingo, many of whom have supported the company over a long period,” he said.
He reassured that Rea Vipingo will stick to primary business of sisal production where it leads in the East Africa. “Rea Trading believes that its plans for continuing sisal growing will mean that …sizeable workforce should be unaffected by the takeover offer,” he said.