TransCentury Halts Equity Bank Takeover
TransCentury PLC has obtained a court injunction in regard to a takeover bid issued by Equity Bank to appoint a receiver.
The injunction is on the basis that the bank illegally appointed a receiver while parties were engaged in negotiations in addition to the brazen breach of procedures set out in the law.
“We are delighted to see that the court has seen the irregularity that marred this very unfortunate and ill-intended process. We viewed the bank as a partner and have been in what we saw as positive discussions to arrive at an amicable agreement just a day before the receiver was appointed by the bank,” said Shaka Kariuki TransCentury Group Chairman.
Transcentury was placed under receivership over default in repayment of a Ksh4.8 billion debt owed to Equity Bank.
A notice on local dailies dated June 16, 2023, stated that Muniu Thoithi and George Were of PricewaterhouseCoopers were appointed as joint receivers and managers by Equity Bank Ltd.
“TransCentury is a significant business in Kenya’s economic landscape, we are committed to meeting our obligation, and hence the reason why we embarked on a Rights Issue transaction at the beginning of the year. Despite the challenging economic environment that Kenya and the world at large faces, we raised money from our shareholders and were preparing to settle on an agreement favorable to the business and the bank,” Kariuki added.
The injunction puts a stop to the appointment of the receivers and restrains them or their agents from performing any actions in the capacity of receivers of the company. This will allow TC to return to focusing on the business operation and achieving the strategy.
“TC Group is steered by a very resilient team and I am confident that we shall recover the time lost as we continue focusing on our mandate of impacting Africa with transformative infrastructure,” said Nganga Njiinu CEO TransCentury Group CEO.
At the beginning of 2023, TransCentury embarked on a Rights Issue transaction that aimed at raising funds with the objective of reducing debt and unlocking working capital.
However, TransCentury failed to meet its target to raise Ksh2 billion from a rights issue following low shareholder subscription. The company raised Ksh800 million only.