Ekaterra Tea Kenya PLC (Unilever Tea) has made a proposal to shareholders of Limuru Tea Plc to acquire up to 100% of the ordinary shares in the share capital of Limuru Tea Plc that are not already legally or beneficially owned by ekaterra Kenya (the Offer)
Ekaterra Kenya already owns approximately 52% of the Issued ordinary shares of Limuru Tea Pic. The Offer will be open to all remaining shareholders of Limuru Tea Pic. and ekaterra Kenya will only acquire additional shares from those shareholders who express their wish to realise their investment in Limuru Tea Plc by selling their shares to ekaterra Kenya.
In its notice, ekaterra Kenya has stated that it has no current plans to delist the company from the Nairobi Securities Exchange and has not set any minimum threshold for acceptances for the Offer.
Further details of the proposed Offer will be issued through the requisite announcements and documents that ekaterra Kenya will issue pursuant to the provisions of the Capital Markets (Takeovers and Mergers) Regulations.
Until a further announcement regarding this matter is made, the public is advised to exercise caution when dealing in Limuru Tea Pic ordinary shares on the Nairobi Securities Exchange.
Ekaterra, hosts a portfolio of 34 tea brands, including Lipton, PG Tips, Pukka Herbs and TAZO and generated revenues of 2 billion euros (Sh250 billion) in 2020.
“Following the engagement with the CMA, Ekaterra Kenya (Unilever Tea) is meeting a regulatory obligation under the takeover regulation on behalf of its parent company Puccini, to make a mandatory offer for all the voting shares not currently legally or beneficially owned by Ekaterra Kenya,” Unilever said.
The law compels investors who directly or indirectly buy more than 25 per cent of a company to make a takeover offer to the rest of the shareholders. However, they can seek an exemption from the CMA on grounds that the acquired firm is in financial distress, the stake bought had been used as security for a bank loan or there is a need to keep domestic shareholding for strategic reasons.
Unilever Tea Kenya has not disclosed the offer price at which it intends to buy out the minority shareholders.