BizKenya

www.bizkenya.wordpress.com

2006-07-03T02:32:00.000-07:00

www.bizkenya.wordpress.com is my new blog name.
You are welcome

My new site/ blog

2006-07-03T02:20:00.000-07:00

Helo Fellow bloggers, I have moved houses and now am on a new and exiting page www.bizkenya.wordpress.com I invite you to my new site and you are well come to contribute.

Budget speech or the World Cup?

2006-06-11T22:59:00.000-07:00

This year's budget Speech falls on the 15th of February and opinion is divided whether the national broadcaster should pause its football signals from Germany and instead air Finance Minister Amos Kimunya read his first budget speech.
In 2002, when the economy was in shambles, the national broadcaster KBC did not air the Budget speech and instead opted to satisfy the soccer hungry Kenyans.
Times have changed since then and Kenyans have become interested in the economy and a good number would love to watch Kimunya set their agenda at least for the next one year.
The soccer lovers says the World Cup is paramount since it comes once in 4 years and it would be a disgrace if they were to miss Ecuador face Costa Rica and miss a bit of England against Trinidad and Tobago.
The economist says the Budget speech should be given priority and we should give way for the minister to deliver his speech.
Which ever way, the national broadcaster which is receiving million of shillings from Celtel and other World Cup co sponsors seems to be opting for the World Cup instead of the Budget speech.
Budget Speech or the World Cup? The choice is yours.

INTERESTING QUOTES ON UCHUMI FROM THE KENYAN MEDIA

2006-06-02T06:20:00.000-07:00

I found some interesting comments by the two Kenya's leading newspapers on Uchumi and thought I would share with you. Havew a look.....

The firm's sales were dwindling, as customers, tired of empty shelves and lack of variety, promptly voted with their feet (Nation)

In its re-launch after the right issue in which it raised Sh1.3 billion, it became more of a green grocer than a serious supermarket......(Nation)

In its zeal to open new branches in every nook and cranny of Kenya..... the firm had committed a schoolboy mistake, it had financed a longterm investment using short term funds (Nation)

Mr. Kirubi had cut his losses and run, he sold his shares in the firm and resigned from its board (Nation)

Uchumi has been in problem solving mode for the last five years (Nation)

Mr. Kirubi made his exit last year, yesterday, when told of the closure he exclaimed;"oh no!" (Nation)

Mr Kirubi, the flamboyant and intrepid businessman, had quietly become the lead shareholder at the chain... and in characteristic swagger, he was shoving his considerable weight around (Nation)

At the opportune time, Chris, or simply DJ CK, dumped his shares and walked away as Uchumi torpedoed towards the iceberg (Standard)

That is what demoralised employees do(Shoplifting) when they stare at retrenchment and have to wait for the 18th day of the next month to get their salary (Standard)

You got to know when to hold 'em, know when to walk away and know when to run. You never count your mony when you're sitting at the table. There'll be time enough for counting when the dealing's done (Kenny Rogers) Standard

Bankrupt Uchumi closes down

2006-06-01T22:44:00.000-07:00

Courtesy of the Nationmedia.com

Story by MUNA WAHOME Publication Date: 06/02/2006

The Uchumi supermarket chain closed down yesterday after finally admitting it was insolvent – throwing more than 1,000 employees out of work and leaving debts of hundreds of millions of shillings.
The stricken firm's chief executive, Mr John Masterten-Smith, announced the Uchumi board had decided to cut the company's losses.
The board had concluded it was unethical to continue trading when they could not pay their debts.
He said it would seek "financial solutions" from its lenders – and that his own resignation had been accepted by the company's chairman, Mr Albert Ruturi. He became chairman little more than one month ago, having replaced Ms Eddah Gachukia, who herself replaced businessman Chris Kirubi only two years back.
Trading in Uchumi shares on the Nairobi Stock Exchange was suspended yesterday by the Capital Markets Authority), but not before around 1.6 million shares had been sold on Wednesday at Sh14.50. Investors could have lost some Sh23 million.
Affected by the closure are the company's supermarkets in Nairobi – at the Sarit Centre in Westlands, Lang'ata, Mombasa Road Hyper and Ngong Road Hyper.
Others are at City Square, Adams Arcade, Jogoo Road, Nairobi West, Parklands, Westlands, Koinange Street, Kimathi Street, and Buru Buru. Also closed are branches in Eldoret, Karatina, Nakuru East, and Meru.
The company had franchised five of its branches to private firms: one in Kisumu and five in Nairobi, at the Railway Station, Market, Taveta Road, Temple Road and Kahawa Wendani.
Earlier, in a bid to streamline its operations, Uchumi had closed other branches, including those in Mombasa, Nakuru and Kisii.
The decision to close Uchumi was announced by the CEO, Mr John Masterten-Smith, at 11.30am, at the company's Nanyuki Road headquarters in Nairobi's Industrial Area.
After admitting Uchumi was insolvent and was closing down, he said: "The business has been encumbered by various hurdles day to day with trade and non-trade creditors."
He was accompanied only by company secretary Waweru Mathenge. Other board members were not present.
Independent sources said the firm's outlets had operated normally until 8.30pm on Wednesday. Then workers were told that they should not go to work yesterday, because they had been given a Madaraka Day rest.
Uchumi has been ailing since 2001, when its board, then led by Mr Chris Kirubi, engaged in an extravagant expansion programme that eventually pushed the company into a cash flow crisis and finally into the red.
Puzzled customers pass the closed gates of Uchumi Hyper on Ngong Road yesterday. The Once flourishing houselhold chain of supermarkets announced yesterday the closure of its stores country wide. Photo by George MulalaMany investors, however, failed to read the signs and sunk almost Sh1.3 billion into a rights issue that had been expected to herald the company's turnaround. They were not even deterred by a Sh1.2 billion loss incurred by the firm in the year ending June 30, 2005.
And there are those who have only partially burnt their fingers in the Uchumi closure. The Industrial and Commercial Development Corporation (ICDC), Kenya Wine Agencies and ICDC Investment gave up some of their rights to new investors during the rights issue. ICDCI baled out completely.
Businessman Naushad Merali’s Sameer Group early this year snapped up 10 per cent of the stake before they quickly pulled out. It was reported that the Uchumi board had refused to grant him the number of board seats he wanted.
Mr Kirubi made his exit last year. Yesterday when told of the closure, he exclaimed: "Oh no!"
Apart from the investors, the company's 1,200 workers in 17 branches were facing the future without jobs.
When making the announcement yesterday, the CEO said they were yet to be informed. "It will be a huge shock," he conceded.
Mr Masterten-Smith, a South African who was hired in November 2004, said at the time: "I am aware of the task ahead of us. I am not saying it is easy."
He now says competition made recovery impossible, in spite of the management's best efforts.
CMA had been informed of the decision, and the company was awaiting a reply. The KCB Group and PTA Bank who are owed hundreds of millions of shillings have also been told.
Yesterday Mr Masterten-Smith seemed at a loss over what financial solutions the board was contemplating for its lenders.
"I cannot enlighten you as decisions have not been taken," he said. "Anything is possible."
Uchumi's recovery strategy appears to have collapsed partly because of its failure to sell its fixed assets. The firm gained only Sh300 million out of the Sh955 million targeted from the sale.
Yesterday, Mr Masterten-Smith said most of the offers were "not suitable".
Asked whether Uchumi's much hyped turnaround was a hoax, he replied: "I do not think we have ever misled anyone in the Kenyan market. We thought the recovery was possible."
The board had concluded it was unethical to continue trading with a negative balance sheet. On the franchise, he said a further decision would have to be taken on their operations. It emerged yesterday that the Kampala branch in Uganda would remain open, because it was a separate company.
Uchumi called television stations to the Press conference in the morning, but for unknown reasons, avoided the print media. Only the Daily Nation and two independent TV stations were present.

other realated links
Courtsey of the Nationmedia.com

Kenya Airways posts Ksh 6.9 billion pre tax profits

2006-05-30T23:19:00.000-07:00

Kenya Airways, East Africa's most respected company has announced today a pre tax profit of Ksh 6.9 billion for the year ended March 31st 2006.
The after tax profit has risen by 24% from Ksh3.88 billion the same period last year to stand at Ksh 4.8 billion.
The airline has recorded a Ksh 52.8 billion turnover up from Ks 42.2 billion same period last year representing a 25% increase.
Earning per share before tax and minority interest stood at Ksh 15.06 up from Ksh 11.95 from the same period last year representing a 26% increase.
Earning per share after tax and minority interest stands at Ksh10.45 from Ksh8.40 representing an increase of 24.4% from last year.
Passenger growth went up by 17% to stand at 2.4 million, dividends went up 40% to Ksh 1.75 per share. Breaking the passenger increase into regions, Europe showed a 20% increase due to the success of the B777 aircraft, which currently number three in total.
The airline expects to take a delivery of a fourth B777 in early 2007 in addition to the three new B737-800 planes by the end of 2006.
The strongest growth was registered on african routes with West and Central Africa leading with 26% growth folowed by Southern Africa, Nothern Africa and Eastern Africa at 22%, 21% and 5% respectively.
During the same period, cargo volumes registered a substancial growth of 24% mainly due to more cargo space available on the larger B777 aircraft and increased frequencies of B767 in Africa.
Managing Director Titus Naikuni said the airline had manged to achieve sustained growth in profitablity despite increased competition and high fuel prices.

KENYA'S ECONOMIC SURVEY FOR 2005

2006-05-25T23:52:00.000-07:00

The Kenya Economy survey for 2005 was released yesterday and as excepted the government was patting its back as it reported an impressive 5.8 % growth in 2005.
The performance as reported has not been experienced for the last 10 years.

ECONOMIC OUTLOOK FOR 2005

STATISTICS AT A GLANCE

EMPLOYEMENT
458,000 NEW JOBS, representing a 5.9% increase.

HEALTH
4,912 FACILITIES

EDUCATION
7.6 Million enrolled in school

TOURISM AND HOTEL.
Grew by 13.3% to earn Sh48.9 Billion in 2005 compared to Sh38.2 billion in 2004.
1.5 million tourists arrived in 2005 compared to 1.4 million in 2004.

AGRICULTURE
Grew by 6.7% compared to 1.4% in 2004. coffee production declined by 6.6% from 48,400 tonnes in 2003/04 to 42,200 tones in 2004/05.
Horticulture exports grew by 19.2% in 2005 injecting sh38.8 billion from 163.2 million tones compared to sh36 billion in 2004.

Maize production increased grew by 11.4% from 29 million bags 2004 to 32.3 million bags in 2005.

Wheat production grew by 45.8% in 2005 to net 128.7000 tonns

Tea production increased from 324.6,000 tons in 2004 to 328.5,000 tons in 2005.

Rise Production grew from 47.6 thousand tons in 2004 to 62.7 thousand tons in 2005.

Pyrethrum production dropped from 41.9 tons in 2004 to 16.4 tons in 2005.

MANUFACTURING
Grew by 5% compared to 4.5% in 2004. it created 5,500 jobs compared to 2,200 in 2004.
Leather and footwear sub sector declined by 4.3% in 2005 compared to a drop of 24% in 2004

BANKING SECTOR
Pretax profit by 47.8% to stand at sh20.1 billion in 2005 compared to Sh13.6 billion in 2004.

Interest income rose from Sh26.3 billion to sh39.7 billion.

Banks lending to private sector grew stood at 294.9 billion representing and increase of 18.5% in 2005.

Borrowing by manufacturers dropped to Sh62 billion from Sh63 billion in 2004.

Public sector lending dropped from Sh14.8 billion in 2004 to Sh13.5 billion in 2005.
Non interest income from fees and commissions grew by 17.85 to stand at sh19.9 billion compared to sh16.9 billion in 2004.

BUILDING AND CONSTRUCTION
Cement production rose by 10.9% in 2005 to stand at 1.5millom tones compared to 1.4 million tones in 2004.

TRANSPORT AND COMMUNICATION
Grew by 16.5% to earn the country sh329.9 Billion in 2005 compared to Sh283.2 billion in 2004.

Mobile phone industry subscription base grew by 56.9% to 5.6 million in 2005 compared to 4.3 million in 2004.
400 million sms’ were sent from the Kencell and Safaricom in 2005.
Newly registered motor vehicles rose from 42,482 in 2004 to 45,653 in 2005.

Its time China joined the Group of Seven

2006-05-22T05:42:00.000-07:00

Two weeks ago, the Chinese government announced that it would be building more than 40 new airports and develop 10 new sea port facilities by 2010 in anticipation of a rapid demand for the transport infrastructure by its ever expanding manufacturing industry.
This news comes in the wake of reports that China has leap flogged Britain as the world’s fourth largest economy. China’s economy has been growing at a steady rate of 9.5% for the last two decades to stand at £1.13 trillion (R12.6 trillion), putting it a whisker ahead of the UK's economy, which weighed in at £1.11 trillion according to official exchange rates used by the Bank of England.
Goldmans Sachs forecast they would enjoy strong growth over the next 30 to 50 years, by which time only the US would still be ahead on pure size.
In its analysis it says the leading economies by 2050 will be as follows in terms of GDP

1. China $44.5 trillion
2. US. $35.2 trillion
3.India $27 trillion
4. Japan $ 6.7 trillion
5. Brazil $ 6.1 trillion
6. Russia $5.9 trillion
7. Britain $3.8 trillion World's largest economies in 2050

With these figures in mind, is it time for China to join the group of seven and replace the lesser country Canada? I guess its time we let the dragon in.
Click Here for more about China according to CIA

Its good news for Daima bank depositors

2006-05-18T07:46:00.000-07:00

If news by the Central Bank of Kenya that depositors of the liquidated Daima Bank should collect claim forms in order for the liquidator to pay them the protected deposits, then there is light in the tunnel for the depositors of other fallen banks like Trust bank and Euro bank who have lost Millions of shillings.
Daima Bank which began operations in January 1993 then later put into statutory management in March 2003 under Simon Ngeny, had a deposit base of Sh709 Million with a gross loan portfolio of Sh934 million out of which Sh737 million of the total loan portfolio was non performing.
CBK says that payment is set to start on Monday next week and will run for one year till the last day of May next year.
Though CBK then said the Daima Bank’s loan portfolio was due to poor risks assessment and high interest rates that led to the massive default, one cannot rule out the malpractice that marred the banking sector in the previous regime.
We hope the government will look into the matter of other depositors who have lost their livelihood to the unscrupulous banking institutions

KenGen: At Sh45, the bubble won't burst

2006-05-17T02:31:00.000-07:00

The KenGen share has made a mark on its first day of trading at the bourse to trade Sh45 proving pundits who had predicted a price of about Sh25 wrong.
It is a suprise start and I may bet with the pessimists that the share will not fall below this mark. People are hungry for money and and want to repay the borrowed cash especially the first timers.
As we have seen, there is a massive order for the KenGen share from the disappointed applicants meaning the demand is still high.
So, lets brace ourselves for a Sh100 mark by next week

KenGen Shares to begin trading in under 12 hrs as prospects brighten

2006-05-16T06:50:00.000-07:00

Finally, the KenGen shares start to trade at the Nairobi Stock Exchange in just under 12 hours and pundits are predicting a tense and an unpredictable future for its share price.
One analyst, Bankelele, in his market watch analysis is cautioning investors from selling their shares too soon in the hope of making quick money.
Well, like any other speculator, Bankelele might be right but the question is: Will the KenGen share rise above Sh11.90 and join the league of Kenya Airways, Kenya Commercial Bank and other blue chip companies as many investors have hoped for?
Some stock brokers are predicting an increase of over 100% in per share price to around Sh.24 once it starts trading tomorrow at the bourse.
According to the lead transaction adviser Mr. Vishal Agarwal, the true worth of each share is Sh95.20 since the share was split 8 times so as to avail more shares to the public. This, as we have experienced, did not solve the equation as the number of applicants rose to an unprecedented over 270,000 representing an oversubscription of over 337%.
There are two likely scenarios that are likely to happen with the share price once it enters the secondary market tomorrow.
The share price might rise once the bell rings at the bourse to as high as Sh.50 until it corrects itsself, but its future is uncertain. The demand for the shares is great as it has attracted immense interest from the local and foreign market which saw the amount raised stand at over Sh.26 billion.
With only 6,431 shares, the 22,707 institutional investors who had applied for the shares might opt to do away with their shares at a price only enough to redeem the cash they have invested as allocated by the Capital Market Authority(CMA).
If this happens it is likely to send the market into panic bringing the share price tumbling down or stagnating.
Another scenario we might experience is a situation where the big investors, both institutional and individual, will offer good cash for shares floated at the bourse at any price hoping to make a kill later. This might skyrocket the shares to unprecedented levels and we might see individual investors who had taken soft loans from the banks or borrowed their cash sell off their shares to the big investors.
However, banks might have the last laugh as with about 10% of the money having been borrowed, we might end up seeing the banks being the largest single shareholders at KenGen with people unable to repay their loans offering back their shares which was the only form of security.
For a company that announced close to Sh.2 billion in profits and issued dividend to the government, the prospects of KenGen are bright. With the energy sector likely to spur in coming years as the demand for power keeps on rising, KenGen shares area must have a long attractability to them. With other related shares (EA Cables, KPLC) rising by the day, KenGen will follow the EABL scenario where shares were split to make them affordable to the Kenyan investor.

Let KBC be

2006-05-16T05:37:00.000-07:00

The recent “transfiring” of Wachira Waruru from the Kenya Broadcasting Corporation to the newly formed Kenya Film Commission (KFC) has once again brought into question the government’s willingness to guarantee press freedom.
First it was the attack on the Standard Media Group which set a precedent for the attack on Hope FM and now the exit of WW, as Waruru is popularly known, from the KBC.
With a massive defeat at the referendum, by-elections coming up in five constituencies and the General Election around the corner, all fingers points at the government as Kenyans sense a sinister motive in this change.
As evident at a plenary session held at the Kenya School of Monetary Studies on January 20th, 2006, key government functionaries, led by Education Assistant Minister Beth Mugo questioned KBC’s role in supporting the government.
What the officials were questioning was the KBC’s apparent failure to front their political agenda at the expense of the opposition which was getting equal coverage on the national broadcaster.
While we agree that as a national media house, KBC should air the government’s agenda where necessary, the matter raised by the government was an old time joke which should not be allowed to happen to find any pride of place today.
What the likes of Koigi wa Wamwere, Beth Mugo and other Kibaki cronies should understand is that the role of KBC is to inform, entertain, educate to all people regardless of their age, religion, tribe and not act as a government’s mouthpiece on some unmarketable and silly government’s political interests.
KBC should be left to run independently and not act on the whims of some people. With his checkered experience in the media, Mr. Wamwere should not as reported in the section of the media order the management or dominate in political programs as evident. Mr. Wamwere is on record for demonizing the Moi regime for interfering with the national broadcaster.
KBC is already basking in glory with popular programs cutting across the section of the society in offing. With Makutano Junction popular with the younger generation and Grapevine, KBC is a must for all.
The station is the leading one in sports coverage, way above all the private media house in the country. The station boasts of Yawezekana, a program airing the government's achievements in the economy, politics and society.
KBC for the first time is being monitored by the other competitors and we should not let this few selfish people spoil the broth

Nakumatt's PR stunt in the guise of market education

2006-05-10T06:04:00.000-07:00

Flipping at today’s newspapers (May 10th 2006) both The Standard and the Nation, I was triggered by a strategically placed advert by arguably the largest and the fastest growing retail shop in Kenya, Nakumatt.
The advert placed on page one of The Standard and page three on the Daily Nation (those who are familiar with advertising can understand why this pages) inviting participants to attend a leadership exchange forum to explain on the secrets behind the success of the East Africa’s most recognized service company.
The company has a kicker saying “Man’s mind, once stretched by an original idea, never regains its original dimensions!”
A rule of thumb as widely known by the PR specialists and the Communication experts reads like, when faced with a crisis, never call a press conference like our politicians do, but rather create an event and reading in between the lines, this is exactly what Nakumatt is inviting participants to explain their success.
This event comes on the backdrop of a major threat to the brand after MPs in Parliament questioned the activities of this company. On a story reported in our print media and the electronic media, the company has been accused of massive tax evasion through the little known Charter Bank. This came long after report from the public domain had been emerging and circulating through the news corridors questioning the Nakumatt’s dealing and their massive expansion.
The MPs told the floor that the company has been sending millions of shillings abroad on a weekly basis and paid peanuts in terms of taxes to the government. The MPs led by Shadow Finance Minister Billow Kerrow alleged that the company, associated with Harun Mwau was being financed by drug money.
These sentiments by the members of parliaments brought the operations of the chain store into question with details from the Central Bank of Kenya through the press saying that the anti fraud unit at CBK had unearthed a massive money laundering and that the former CBK governor Dr. Andrew Mullei had requested the minister for finance to close the bank.
From these, is the company trying to reclaim its slightly tattered image? From the backgrounder, the management must have realized as they are trying to tell us through their advert slogan, a man’s mind once stretched by an original idea, never regains its original dimensions”
It is from these allegations that the company might be trying to clear the air and rub off any doubt in their customers’ minds.
The company might be in a fix and it’s trying to clean its linen in the guise of educating us on the secrets behind the success of Nakumatt.

Zuma guilty in the public court of opinion not in a court of law

2006-05-09T23:07:00.000-07:00

South African Judge Van der Merwe referred to the poem If by Rudyard Kipling when acquitting ANC Deputy President Jacob Zuma saying if Kipling had known of this case at the time he wrote his poem, he might have added the following: “And if you can control your body and your sexual urges, then you are a man, my son.”
That word of wisdom to the ladies especially, summed up the whole trial in acquitting Zuma whom many, especially the anti Aids campaigners had hoped that the former second most powerful person in SA would go to jail.
Judging from the uncalled hullabaloo created even from the remotest part of this world, Zuma was only guilty in the public court of opinion but not in a court of law.
The bench in the public court of opinion had longed sent Zuma to jail saying he deserved not less than a jail sentence.
In his six hour ruling, the judge said he had no doubt that the two parties had a mutual consent when having sex meaning the lady had not been raped. Reading in between the lines, Zuma is guilty only because he was the second in command in SA.
He is only guilty because he headed the National Aids Council which advocated for the use of condoms in its campaign to fight the pandemic. Having gone against the will of people where he was supposed to lead by not only words but examples, Zuma was demonized.
His critics had one thing in mind, send Zuma to jail and it will serve an example to the rest which is unacceptable.
What if the lady was not infected with the virus would the case have created such debate? The verdict we can set here is had Zuma controlled his sexual urges which many are unable to do before they had an affair and used a condom he would only be accused of having an affair.
There is no difference between Zuma and the likes of Bill Clinton, Charles Clarke and many more people who have been overwhelmed by their sexual desires.
Zuma’s critics should understand that he was doing it at his own risk, he never infected anyone and what the lady is suffering from is guilt of having an affair. To the lady, Zuma was a family friend but to Zuma just like many men, there is no term like a family friend.

of media and the government

2006-05-09T01:57:00.000-07:00

I am perturbed by the endless outcry by politicians mainly from the government side on role of the media in the country which has caused nonstop attention from the first to the fourth estate.
A tired saying by the anti media, mainly from the first three estates says people would prefer a country with a government minus the media rather than a country with the media but no government.
This chicken egg matter would work no where in the modern world as the media in one of its key objectives, must watch the government for the people. No single democratic country can thrive without the media, and no government can work without the media, period.
What Messer Raphael Tuju, John Michuki and his son in law Mutahi Kagwe and other media critics should realize is that, the media watches for the society and no one time should they expect the media to pat their backs for a job well done.
What is the media expected to do when the Anglo Leasing is hatched? When the government engages in extravagance in expense of a starving society, should the media sit back and spike Maina Kia’s report as a sign of support to the government?
The proposed media bill hopes to curb and control the media but reading between the lines it hopes to curb unpopular politicians who have vested interests from owning media houses.
The media bill is well intended and some of its clauses should be supported as they seek to protect the oppressed journalists who have no one o speak out for them.
While we blame the current government, the opposition should not be spared either as it provides continuity to an error created by the leaving regime. What the government and the opposition should realise is that almost everywhere in the world the fourth estates sets the agenda.
What the new Kibaki inner circle has realized is that, in order to make Kibaki marketable in the coming elections, they have to tame the media which has vigorously dried his dirty linen in public.
With no media in the country which seems to endorse his candidacy, the government has resulted to gagging the media by arresting journalists, raiding the media houses which as expected, have shredded his character and that of his cronies into pieces.
While analyzing the media, the leading media in the country are nothing to write home about for the government. The Standard Group which has kept the government on its toes is controlled by people affiliated to KANU. Nation Media Group cannot be relied on anymore. The Royal Media Service which has supported his tenure is under going a face lifts and with its journalists being harassed, its support is in doubt.
The government should see this as a normal scenario as seen in the world. In Italy for example, Prime Minister Silvio Berlusconi owned and controlled the leading media in the country.

Stock Market: Give chance to young investors

2006-04-26T06:40:00.000-07:00

The recent off loading of the 30 % of KenGen shares by the government will go down as one of the most successful IPOs in the country.
The IPO has also set a precedent in the Kenyan money market where a government has shown its commitment to give part of the ownership in parastatals to the Kenyan public.
The IPO has shown people an alternative place to invest their money away from the traditional banks and in the building and construction industry.
The move has also opened doors to corporate bodies where they can source additional funds for expansion through right issue, bonds and IPOs at a very low cost compared to bank loans which have exorbitant interest rate on repayment. (Click here for a glimpse of the borrowing rate charged by various banks in the country)
But the most significant feature in the IPO was the presence of the young Kenyans seeking to buy part of KenGen’s equity.
The new Nairobi Stock Exchange Chairman Jimnah Mbaru who replaced Da Gama Rose is calling on the government to off load 20% of its shares in Safaricom, Kenya's largest mobile phone company.
Mr. Mbaru hopes that, by off loading the 20% shareholding to the public in a company worth over Sh100 billion, the government will be able to wipe the over Sh12 billion likely to be returned to unsuccessful applicant in the KenGen IPO due to over subscription.
20% of Safaricom according to Mbaru will represent about Sh20 billion which the governmnet is likely to get from the Safaricom IPO compared to the Vodafone offer of 11% of Safaricom share at a cost of $100 million.
With the KenGen offer, it was evident that even the young people have the knack for investing and should be given a chance to be part of shareholders in the Nairobi Stock Exchange.
With few young people owning shares in blue chips companies like Barclays, Kenya Airways and East Africa Breweries it's time the government gave them a chance by off loading some of its shareholding in a number of state owned companies.
The young investor can hardly afford to invest elsewhere apart from the stock market. Investing in unit trust will require him a to have a minimum of between Sh250,000 and Sh500,000 which is a pipe dream to many.
The Kenyan banks have become a total rip off, charging unnecessary fees and offering low interest rate for his savings.
Its time the government gave the young Kenyan this chance. The government has the intention of giving away part of its ownership in National Bank and Consolidated Bank among other fully owned companies and this should be done through the stock market for the benefit of the young investor.

Bank withdrawal rate at the Counter

2006-04-26T03:09:00.000-07:00

BANKS CAH WITHDRAWALS

WITHDRAWAL OVER THE COUNTER

BANK	FEE(KSH)
STANCHART	500
BARCLAYS	300
STANBIC	150
CO-OP	100
KCB	100
NBK	100
TRANSNATIONAL	50
EQUITY	50
AKIBA BANK	NIL
ABC	NIL	source:money magazine

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BANKS ATM WITHDRAWAL RATES

2006-04-26T03:06:00.000-07:00

BANK WITHDRAWAL RATE
ATM WITHDRAWAL

BANK	FEE(KSH)
BARCLAYS	30
CBA	30
EQUITY	30
INDUSTRIAL DEVELOPMNET	30
I&M	30
STANBIC	30
CO-OP	25
TRANSNATIONAL	25
STANCHART	25
KCB	20
NBK	20	Source: Money Magazine

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Karibuni, ladies and gentlemen!

2006-04-24T04:47:00.000-07:00

Hi guys -
This is my blog.
I'll be returning with more news, features and opinion in the next few days.
Soma na pia julisha raia wengine!