Monthly Archives: December 2006

Tiomin Delay

Tiomin has sent notice that it will “delay construction of the
Kwale Project until the Government of Kenya resolves all land related issues” – i.e. some farmers have objected to the price they are being forced to give up their land to the project.

I think it is okay to ask it Tiomin will add value to Kenya: Are mining companies the right kind of investors for Africa anymore? Their legacy in most countries is not good and the Tiomin parent group has a history in South Africa. And when you look at the Fluorspar mines and companies like Magadi Soda that have been in Kenya for a hundred years, what is their contribution to the employment, the economy, citizens, and the government in form of taxes compared to five year old Safaricom and Celtel?

Al Jazeera in Kenya

Today is Jamhuri Day and for the first time in many weeks, I was home watching morning TV. There was an interesting piece called “global voices” on NTV with stories about citizen media issues and tolerance in Lebanon and Iran. At first, I thought it was a special documentary on CNNI or BBC then I realised I was watching Al Jazeera TV which the Nation Media Group had said it would start broadcasting had announced it would start broadcasting.

The screen graphics have the deep red of BBC and the presenters were a multi-cultural mix of black, Caucasian and Indian which I noticed when they mentioned all their correspondents and bureaus in Kenya, SA, Zimbabwe, Ivory Coast etc. The only familiar face was Riz Khan who used to be on CNN years ago.

It’s refreshing to see some new media from another country’s perspective now. CNN started in 1990/91 and was later joined by BBC and SKY which local networks run their feeds in the morning.

I hope it is understood as an alternative to the ever-present (US/UK) news view and that NTV does not run a risk by rubbing viewers and advertisers the wrong way. There’s an undercurrent streak of anti-Islam or anti-Arab (without distinguishing which) views among common Kenyans which may be fanned by indiscriminate terrorist acts and some of our own religious leaders.

Whenever anything is done to accommodate Moslems such as Kadhi’s courts or Sharia banking services many Nairobians ask – why are they so special? whey can’t they conform like the rest? why are they imposing their religion on us? This is a myopic view of a religion that numbers almost 1/4 of the planet.

NTV which was recently added to DSTV now give their satellite viewers an early morning peek of Al Jazeera on their feeds.

Ecofade II

Part I

Econet Wireless fired off another long letter to the Minister for Information and Communications this week in addition to printing it (2 pages long, badly worded, with typos) in the Nation to explain why they have not rolled out almost two years since they were awarded the third mobile license.

The company which has a history of big talk blames red tape and invisible forces who have continued to manipulate the license process.

Econet’s MD writes that they want (then) Minister Raphael Tuju to retract his unauthorised statement cancelling Econet’s license and also wants the CCK to issue them with network codes. They claim CCK and various officers have been pushing them to renegotiate with KNFC (an entity who could not pay for 5% of their purported 82% ownership), and also lend money to KNFC to enable them to pay for their $12m portion of the license fee.

Econet claims to have already spent $40m on the process (also what happened to applied for jobs at Econet?

Air news

– Early Bird offer from Kenya Airways has round-trip flights to Mombasa at 5,000/= if you take the 6:45 a.m. flights.

– Kisumu Airport should reopen next week when repairs should be done.

– Qatar Air Cargo to serve Nairobi and Eldoret from next year.

December 9 Opportunities

Jobs

Corporate affairs group leaders (2) at Celtel. apply to hr@ke.celtel.com by 15/12

Internal audit manager at East African Portland cement. D/L is 22/12

East African tea trade association
– finance/investment analyst
– project management office director
Apply by 22/12 to eatta.tea@gmail.com

Power economist at the Electricity regulatory board. D/L is 29/12

Multi-lingual flight attendants at Kenya Airways – (both male and female) – fluent in Hindi, Arabic, Spanish, Italian, German, French and Portuguese aged 21 – 30 (in addition to the other similar flight crew requirements). D/L is 20/12 for applications to the group human resource director.

Director treasury at Kenya commercial bank. Apply through Hawkins associates

Oracle
– education sales consultant
– middleware pre-sales consultant
More details their site and apply to mearecruit_ae@oracle.com by 15/12

Retail, sales & marketing – area business managers (2) at Shell. Apply to hr@ksl.shell.com by 11/12

Urgent cargo
– chief operating officer
– general manager – freight
Apply to hr@urgentcargo.com by 18/12

Internships

Aga Khan Foundation young development professional (YDP) program a 1 year leadership and management development program – accepting two streams this year (i) development management (ii) arts, media, or culture management web link here and deadline to akf.kenya@akdn.org is 20/12

Kenya Oil Company (Kenol) management trainees preferably who are fluent in Portuguese or Spanish. apply by 18/12 to the human resource manager.

Stanbic IPO

This week I made a first foray into international investments (since a short-lived stint with T. Rowe Price mutual fund) by signing up to buy shares in the Stanbic IPO (Uganda).

Earlier this year a cement company had an IPO in Tanzania but that was not available to Kenyans while the Stanbic offer is. Though earlier marketed as being exclusive to Dyer & Blair (D&B) customers, other brokers have forged links with Ugandan financial institutions to enable more Kenyan’s to participate.

I paid 3/= per share at CFC (plus a 750/= processing fee) while a certain wealthy investor/dentist informs me that D&B has them at 2.85 each as does African Alliance at the same price.

Still, there are some risks of investments mentioned in a D&B analysis including limited trading days at the USE, no CDS system (we’ll get paper share certificates), power rationing could negatively impact company loan repayments, and the Uganda shilling may depreciate against the Kenyan one. Also, dividends will be paid in Uganda shillings (1 KES = 26 Ush) but at least they can be repatriated in full as movement of capital is free.

Stanbic is Uganda’s largest bank and is rated as the highest quality stock ever offered on their stock exchange.

Diamond Trust EGM

Diamond Trust Bank will have an extraordinary general meeting (EGM) on December 21. The company has not amended its articles of association since 1982 and want to update them to reflect new capital structures, governance, CDS and the electronic age, among others.

Jubilee Insurance will have an EGM on December 18

The various proposed amendments will have outcomes including:

  • New capital: Creation of preference shares and also clears the way for a share split.
  • Shareholders who don’t approve of company actions can have their shares forfeited. E.g. minority Serena shareholders who did not approve the conversion to TPSEA
  • Modern technology: Allows notices and other documents to be e-mailed to shareholders. (This can save costs; i.e. the company has 10,000 shareholders and budgeted Kshs. 7 million for printing and postage of the ongoing rights document). . Also allows board meetings to be held by teleconference or video conference, allows dividends to be paid by electronic means (e.g. bank transfer, direct debit) not just by cheque and notices can be sent to shareholders outside Kenya
  • Super shareholders? New articles recognize that 10 members constitute a meeting and allow any director or any 2 members to convene an EGM. The company’s top 10 shareholders own 48% of the company while the next 50 own another 10%.
  • Governance: recognizes that directors are not disallowed from doing business with the company provided they disclose this to fellow directors and also don’t vote on such issues. Also, fellow directors may remove a director who misses 3 meetings.
  • Cap on underwriting commissions at 10%. (Another cost-saving measure since the on-going rights issue has budgeted placing commissions estimated at 28%). Also, stockbrokers may be paid in the form of shares.
  • Makes provisions that stem from the 2006 budget speech where the Finance Minister proposed that any dividends unclaimed after 7 years be returned to the CMA’s investor compensation fund from where individuals can claim when they resurface.
  • A bankrupt person may vote by proxy

Charterhouse depositors cry foul
Charterhouse Bank and depositors are asking (in a full-page newspaper notice last week) why was their bank, with no liquidity problems, shut down without sufficient explanation and why they are still denied access to their funds almost six months later even after a court had lifted the order? The accounts of the bank remain intact and they are still earning interest on almost Kshs. 3.1 billion in deposits there as the statutory manager has invested surplus funds in government securities. Only staff costs have shot up reflecting the additional managers deployed from the central bank.