What is it with company mergers in
Kenya? The recent few mergers have been faced with very gruesome legal battles that have left the merging companies with very heavy bills to foot. In the case of the Stanbic-CFC merger where Stanbic bank lost a court case and was forced to pay Ksh.532 million in fines to their former employees and Ksh.200 million in forced security to a certain creditor who will be paid once the merger is concluded.
Another merger that has run into similar trouble is the merger between Ecobank from
West Africa and EABS. Ecobank is planning to
take over 75% of EABS at a cost that is estimated to be worth over Ksh.1 billion. Similarly, 30% of there employees who were retrenched way back in 1996 have gone to court to block the merger from taking place before they are fully compensated.
So is this a new strategy by all former employees to sue their employers once they cite a merger in the offing? It’s widely known that many employers are shrewd when it comes to making contracts that favour the company over its employees. Like in the case of EABS where an employee who had worked for over 5 years was only entitled for 17 days compensation. What a reap-off! But it seems employees are not taking these lightly and companies are paying dearly for not having their contract tight enough.
2007 Government Funds BeneficiariesI’ve been looking around for someone who got the youth or women’s fund or someone who know someone who benefited from these funds. It seems I’m not alone on this quest,
Enterprise Kenya are also looking for these funds beneficiaries. If you applied for the youth fund or the women development fund how much did you get? Please send your answer to
enterprisekenya@ktnkenya.com and also drop me a mail at
kainvestor@gmail.com
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3 comments
Ka-investor, I do not think that the employees are being rogues. Haki ya mtu ni haki yake and we should not let-off these companies easily.
Mon Jun 09, 04:23:00 AM GMT+03:00I suffered as a former employee of a company that now wants an acqusition/merger in the local market and I will tell you that it is not interesting
Ka-investor, I have read elsewhere about how companies nowadays dread AGM's due to increased knowledge by investors!!Thanks to people like you, the investing public is allowed the opportunity to get some real information.
Mon Jun 09, 05:04:00 AM GMT+03:00With this regard, I have just been looking back at the 15 months released by BOC Kenya Limited in which a turnover of 1.505billion was announced with a lot of pomp of 36% growth, and was splashed in all the papers.After discerning clearly, this was not comparing apples to apples. Using a simply arithemetic of dividing the sales by 15 months and multiplying by 12, the turnover would have been 1.204 billion, which is a 9% growth over prior year. Using the same logic (which might not be true)the operating profit works out to 288million ( 4% below prior year) and not 20% as lauded in the newspapers. The same works out for Profit before tax as well as profit after tax, both at minus 4%,and not 20% as per the newspaper realease.By the way, this is a Jua Kali approach to Financial analysis!!!
What will happen in the next financial year when the 15months will now be compared with 12 months??Will this not mislead investors??
Taking into cognisance that the comapny may have increased prices at the begining of the year,volume growth seems to be eluding the company.There may be factors such as competition,inefficiencies,new product development etc.
Could you please get us an expert in the gases industry to give us the fundamentals that are affecting the operations, so as to help guide our investment decisions once the shares get back to the market?
@Anon 1: Sorry for loosing you job.
Mon Jun 09, 03:30:00 PM GMT+03:00@Anon 2: Nice analysis on BOC. I will look at it and see if i get an expert to analyze it.
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