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Wednesday, May 07, 2008

Kenyans get royally SCREWED by Safaricom

Hear it here first!

Kenyans were taken for a ride by dyer & blair, morgan stanley, GoK crooks...

The foreigners - favoured by the idiots who set up the OFS- will pay KShs 5.50 for their shares!!! Yes, a mere 50 cents more than what wanjiku paid!

If I could get all the shares I wanted, I would have paid 6/-, let alone 5.50!!!!! So would have 1,000,000 other Kenyans.

I am pissed that the Kenyan government either got taken for a ride OR there was oddles of CORRUPTION.

Anybody interested in knowing how we got taken in?

10 comments:

Ryan Shen-Hoover said...

Why don't more companies go the dutch auction or book-build route when going public? It seems like that would be a more effective way to raise funds.

coldtusker said...

Because the d&b and ms of the world don't like them. They want the 'cheap' shares for their favored funds and clients.

Google did a dutch auction. Not popular with the investment banks!

Ssembonge said...

According to BD, Kenyans forked out 97 billion, enough to buy all the shares at 6 shillings.

I'm guessing the next fiasco will be the allocation of shares.

We haven't heard the last of this messy IPO.

coldtusker said...

SSembonge: There should be a sense of outrage from the local investors esp Wanjiku who had to:

1) prep-pay for the shares unlike the 'foreign' investors.

2) got a lower overall initial allocation of the entire Offer (33.8% vs 35%) than the foreigners.

Anonymous said...

Dude before you pull ur hair out. I hear u. But remember since the locals were more than 200% oversubscribed they shall pull back another 15%.(See local published rpts on this)

Meaning we(locals) then get 80% or 40B out of 50B in the total allocation.

Assuming that converts to approx. 30 - 40% allocation(Being overtly optimistic here) we shall sing halleluyah. Really closer to 30..I'd say.

However, the trick is what portion gets to local QII v/s Wanjiku coz that's where the games shall be played. :-)..the employee and Safcom agents quota being negligible.While we're busy ready to lynch the foreigners what difference does it make that a few local 'fat cats' end up with a majority of the shares. Don't get me started with D&B related issues.

Foreigners getting 10B is actually zilch.. nada...(approx. $150M) in the big picture. That amount can be swallowed by a single Mutual Fund on Wall Street or Canary Wharf pretty easily.
Regardless of P/E issues this stock is still in essence worth 3pence or 7cts!!! Think about it.

So u see, in essence there will still be a strong secondary mkt even if not within the same day.

It's only if the local investors hang onto their shares long enough. (Brokers play a huuge role).Flooding the mkt on day 1-3 will not help matters. If we're stingy for at least 1 week...watch what happens!!!

Alternative Viewer.

fimbo said...

The shares will still end up in foreign hands since most Kenyans cannot hold them more than a few days

just what? said...

ryan,
wouldn't the dutch auction prices leave out a large chunk of the retail investors?

cold-tusker,
sorry to digress, but since you're the one who notices such things,analyse this monster sentence from the business daily (9th may):

"However, interviews with several key players who are familiar with the events reveals a complex series of events that could have led to Mr Henderson departure and though they are specific to Old Mutual, they are emblematic of the Kenyan insurance sector and the fund management industry in the last one year after share prices suddenly collapsed on the NSE in March 2007 after the bubble of unusually high stock prices that are not supported by high quality profits burst."

coldtusker said...

just what: Huh? Yes, I read it but it is all goobledygook...

I am sure you have read my gripes on the state & quality of business reporting in Kenya...

Anonymous said...

Something stinks here! Foreign institutions should have paid at least 7shs. How do foreigners buy a "mwananchi built" company at a price below its valuation?. They should have set a reserve price for foreigners of at least Shs 6.50 per share. Kenyans deserve full disclosure on this matter but, I will not hold my breathe because Mobitelea is still the elephant in the room...

adam cartwright said...

if you dont tellhow we were royally screwed i will hit u over the head....