Kestrel Capital estimates that the KenolKobil-Puma energy venture could be worth more than $300 million (Sh25 billion) in absolute terms.
This means that major shareholders who have already agreed terms with Puma Energy over the company’s sale stand to make more than Sh17.5 billion.
Wells Petroleum Holdings is the single largest shareholder in KenolKobil with a 24.9 per cent stake, followed by Petrol Holdings (17.34), Highfield Ltd (12.46), Chery Holding (7.8), and Energy Resources Capital with 5.99 per cent.
The former Kanu-era Cabinet minister who owns majority stake in KenolKobil —through proxies — will make more than Sh15 billion, a record in corporate Kenya.
What he stands to reap is six times the Sh2.5 billion Finance Minister Njeru Githae allocated for recruitment of additional 3,500 police officers during the 2012/2013 financial year in this year’s budget.
The former minister’s take home will be enough to fund key items in the 2012/2013 Budget. Notably, it will be enough to fund all irrigation projects in the country (Sh8 billion) and hire an additional 10,000 teachers at a cost of Sh8 billion.
The only person who has come close to achieving similar feat is business magnate Naushad Merali.
Merali bought 60 per cent of Vivendi — the French firm with whom he co-owned Kencell — at Sh18.4 billion and sold the shares to Celtel for Sh20 billion two hours later, coming out with a cool Sh1.6 billion profit in March 2004.
The arrangement also shadows a similar story that happened in October 2000 when Merali acquired East African Cables from Delta Group Plc of UK, which wanted to exit Kenya.
Merali bought out Delta’s 75 per cent equity in the company for a reported Sh6.8 per shares — amounting to Sh104 million.
In late March 2004, Merali sold the company to local investment group, TransCentury for Sh15 per share or Sh230 million. This arbitrage opportunity netted Merali a cool profit of Sh126 million.