Rea Vipingo acquisition case settled out of court

Centum Investment Limited has settled out of court a case it filed at the High Court contesting the takeover of a mega plantation firm, Rea Vipingo.

The court heard that the investment company would not continue with the case it had filed against Treasury Cabinet Secretary Henry Rotich and Capital Markets Authority over formation of a tribunal that would listen to Centum’s plaint over the sale of Africa’s biggest Sisal producer.

This came after the investment firm reached an agreement with the two parties.

New Date

“The matter has been settled and we ask for a mention on December 21, to record a consent,” the High Court Judge Justice Weldon Korir was informed.

Centum had move to court on May 21, this year, seeking orders suspending the takeover to allow time for the hearing and determination of a case it has filed before the tribunal seeking to quash an offer made by two British brothers, who are majority shareholders of the sisal plantations firm.

Centum was opposed to CMA’s approval of the revised offer by REA Trading Limited arguing that the offer is dependent on the sale of Rea Vipingo’s property, arguing that this was against the law.
The court heard that CMA had approved the revised bid contrary to what was provided in the domestic takeover regulations.

Centum, one of East Africa’s biggest publicly traded investment company, had moved to the Court saying Capital Markets Tribunal lacked a quorum to hear the appeal against the decision.

REA Trading had proposed to buy the 43 per cent of REA Vipingo. It then added the stake to Sh70 per share, saying shareholders had accepted the offer and would be entitled to a pro-rata share of dividends or distributions of proceeds from the potential future sale of land for as much as Sh15 per share. Centum on the other hand was offering Sh75 a share for the company.
REA Vipingo was suspended from trading on the Nairobi Securities Exchange after REA Trading made an initial cash offer to acquire the company.

The stock last traded on November 13 at Sh27.50, giving the company a market value of Sh1.65 billion.

REA Vipingo operates two sisal estates in Kenya that produce about 12,000 metric tonnes a year of the fibre. When processed, the produce is used to make ropes and dartboards.

The matter will be mentioned on December 17 for the parties to file a consent.