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Cross-listing of Kenyan supermarket meets hurdle
Cross-listing of Kenyan supermarket meets hurdle

Cross-listing of Kenyan supermarket meets hurdle


From - Mar 13th 2014, 12:00

Dar/Nairobi. A technical challenge is delaying the cross-listing of Uchumi Supermarket at the Dar es Salaam Stock Exchange (DSE), BusinessWeek has learnt.

DSE chief executive officer, Mr Moremi Marwa told BusinessWeek earlier this month, that the Kenyan supermarket is yet to resolve some technical challenges with the Business Registration and Licensing Agency (Brela), making it difficult for capital market authorities to approve the cross-listing process.

“From what I know, the company is yet to resolve a technical challenge with far, we have approved a number of issues on the checklist but there is only one thing that they need to resolve with Brela before we grant them a go-ahead to cross-list,” Mr Marwa told BusinessWeek on Monday.

The challenge, he said, has something to do with ownership of Uchumi Supermarket that operates in Tanzania against the mother Uchumi Supermarket that is seeking to cross-list.

“Once that is resolved, we will swiftly allow the company to cross-list,” he said.

Uchumi Supermarket has set a June target to conclude a rights issue, with the retailer saying it is only awaiting the approval of the capital markets regulator in Kenya.

The supermarket chain has been targeting to use the proceeds of the issue, expected to be at least Ksh1.5 billion (about Tsh27 billion) in an expansion drive that will see it add six branches to its portfolio by the end of the year.

Uchumi CEO Jonathan Ciano told The Citizen’s sister paper, Business Daily, in Nairobi last week on Friday, that the retailer has completed all the plans for its part for the rights issue.

“We are looking to conclude it before the end of our financial year in June. Everything is ready except the final approval from the Capital Markets Authority (CMA),” said Mr Ciano. The rights issue had been widely anticipated to take place by the end of last year.

Uchumi is yet to disclose the offer price but it is normally a six-month weighted average share price plus a discount or premium. The share was trading at Ksh18.10 on Friday, having touched a high of Ksh24 in the past one year.

It is anticipated that Uchumi’s rights will be sold across Kenya, Uganda, Tanzania and Rwanda, where the retailer has cross-listed.

The chain cross-listed on the Rwanda and Uganda stock exchanges in October and November 2013 respectively but cross-listing on the Tanzanian bourse is awaiting regulatory approval.From  

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