Uchumi to mobilise Shs45 billion through rights issue

The Shs450 targeted offer price is a 21.7 per cent discount off the retailer’s current value at the Nairobi bourse. Most firms use the average trading price over a six months period to arrive at a rights value.

Uchumi Supermarkets targets to raise Shs45 billion through a rights issue set to happen in the second half of next year, pricing the offer at Shs450 a piece.

Shareholders of the listed firm approved the plan to offer 100 million newly created shares to raise cash to fund local and regional expansion.

The Shs450 targeted offer price is a 21.7 per cent discount off the retailer’s current value at the Nairobi bourse. Most firms use the average trading price over a six months period to arrive at a rights value.

Jonathan Ciano, the Uchumi chief executive officer, said on Tuesday the cash will be raised by December 2013 and regulatory approvals will take about five months - pushing the rights issue to the retailer’s first half that runs between July and December.

“The purpose of the rights issue is to finance opening of new branches and refurbishing existing outlets,” Mr Ciano told shareholders at the company’s AGM held in Nairobi on Tuesday.
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