Centum Investment Company Limited, East Africa’s largest publicly listed private equity company, has officially announced substantial divesture of its 22% shareholding from the Nairobi Stock Exchange listed Carbacid Investment Ltd.
The divestiture process was driven by the need to raise funds to invest in other opportunities that have the promise of delivering even better returns.
Centum Chief Executive Officer James Mworia, confirmed the move saying; “We still believe that Carbacid has very strong business fundamentals, which are underpinned by an expected expansion of the beverage sector and the strong economic growth in the region.”
“We have now developed an attractive pipeline of opportunities across Sub-Saharan Africa and it is important that we rank the return potential of our existing investments against that of potential investments,” he explained.
Centum acquired the 22% equity block in Carbacid for Kshs 418 million ($4.9 million) in May 2009. Over the two years it has held this investment it has generated Kshs 1.2 Billion ($14.2 million) in dividends and disposal proceeds
Mworia noted that Centum had made a holding period return of 190% and this investment was illustrative of the sort of investments the Company is making and demonstrates Centum’s capacity to create real tangible wealth for its investors.
He added that this exit showed that there was sufficient liquidity and depth in the local capital markets and that there existed opportunities to generate market beating returns not only in Kenya but in most of Sub-Saharan Africa.
Centum, which is listed on the Nairobi Stock Exchange (NSE) and the Uganda Securities Exchange (USE), seeks to provide investors with access to a portfolio of inaccessible, quality and diversified investments in the firm’s quoted private equity, private equity and real estate and infrastructure business lines.
The company has maintained a strong track record of delivering market beating returns. Between March 2009 and September 2010, Centum increased its asset base from Ksh 6.5 billion ($77 million) to Ksh 10.3 billion ($121 million) and delivered a 146% return to its shareholders with its market capitalization rising to Kshs 13.9 billion over that period.
NIC Capital advised Centum on the Carbacid exit.