Mid-week Business

International takeover
The Linde Group, (Germany) has applied to takeover the BOC Group (UK) which owns 65% of BOC Kenya – and who are in the process of acquiring Carbacid Kenya. Both local company shares remain suspended on the NSE and BOC Kenya managers’ don’t expect this new deal to affect the Carbacid takeover which is yet to be approved by the CMA.

Nosy bankers
– The Judge at the corruption trial of former Central Bank Governor, Andrew Mullei has refused to allow Charterhouse Bank lawyers to cross-examine witnesses.

Kenya Commercial Bank has thwarted efforts by the City Council to set up a public toilet on Aga Khan walk, opposite Kencom House.

Sometimes, Government is a good shareholder
Kenya has blocked Ethiopian Airlines from operating daily flights on the Entebbe-Nairobi route. The move could however trigger a backlash since it’s only a matter of time before other African counties, envious of KQ, and desiring to revive/support their airlines, retaliate with their own trade blockades.

The high court has indefinitely extended the period for Madaraka residents to obtain financing to purchase their houses.

Equity No. 1
Equity, is the first bank to report quarterly results as at 30 June 2006 and they have come out just in time for their shares to list on the NSE on August 7. On Monday, the Bank announced some amazing numbers. From a year ago (June 2005) assets are up 55%, pre tax profit is up 115%, deposits are up 67% while loans are up 130%. Good Buy, on August 7? Maybe!

All VoIP
All the three major phone companies in Kenya are now offering VoIP for international calls.
A comparison of call costs to the USA;
Telkom 888 15/= per minute ($0.2)
Celtel 123 29/= ($0.39)
Safaricom 888 30/= ($0.4)

Restricted News
The Daily Nation has joined the East African Standard and now restricted the magazine section articles on their website to premium subscribers only (One month costs $10 while annual cost is $ 60)

Kuku Cars
Cool true story on converting a Volkswagen Jetta to run on cooking oil and achieve 600 miles a gallon! Wouldn’t it be cool if someone started converting our local Toyota’s so that a taxi driver could buy chips, from Kenchic and then squeeze out the oil to put in his fuel tank?

Oil & Gold
Gold: encouraging results from Migori
Oil: High potential deposits in Lamu.

11 thoughts on “Mid-week Business

  1. JabaBoeku

    I can hardly wait to get some competition on the EBB-NBO route.
    My delayed flight on Sunday evening, from 6:10Pm to 9:30 PM was not interesting at all; coupled with the fact that I had to sit on cold concrete waiting.
    Travellers def. deserve better treatment!

  2. Mashatall

    Banks nation decision to charge for premium content will not work, costs are too high !!
    cost of buying nation paper on the ground in kenya
    30×30=900KSHS/month (if nation is still retailing at 30KSHS)
    10$x72=720KSHS/month (to access premium content/magazines)
    Whoever is in charge of online development at nation should come to his senses.Why should i pay such a high price for the magazine content, which is almost the full price i would pay for the paper if i was on the ground for the whole month? we will still get our content from other sources (blogs,content aggregators like allafrica.com), especially for guys abroad. They should have split the magazines into different sections that you could download as a PDF. Am only interested in Smart Magazine, which is the finacial and business pullout. And i would be willing to pay 99 cents for a copy of the download depending on the content. The ol skool retail strategy does not work online, and they can not combine all the magazines and expect us to pay for it, let them give me a choice as to which magazine i want to down load.
    As for Equity bank, lists at around 70kshs, me thinks thats a little bit too high. But with the bulls going on a rampage on the market, it might just surge over 80 especially with the good results they just announced.

  3. Ig-know-rant

    Oil and gold… I hope it’s not of the alluvial type that is found only 5-10 metres deep. Alluvial minerals due to their low costs of production have been blamed for most of the wars in africa (DRC, Angola, Chad, S. Sudan, etc). All you need is a guy with a gun and another with a spade to scoop the loot, not high capital intesive stuff.

    Kuku cars…a nice one. I saw on BBC the other day a guy in Thailand who is making $$$ by converting cars to run on cooking oil. Imagine just blending used Kimbo (after making mandazis)to run your gizmo!

    High Court, Mulei and Charterhouse…the judge was right. In criminal cases, the state represents the complainant. If he hires a lawyer, or if a witness hires a lawyer, all the lawyer does is to ‘hold a watching brief’ (that’s what we call it). It’s nothing more than sitting in court and listening as state prosecutors does battle with the accused counsel.

    KQ and the EBB-NBO route…. one of these fine days especially when the Yamassoukro declaration on open skies comes to force (in light years, I believe) KQ wataona. Competition is healthy.

    Nation and EA Standard…it’s a bloody joke. When i was abroad, and when I do happen to be abroad, I used to/do compare services offered by other newspapers online and our two newspapers are miles behind. They don’t even have a blog page. The day someone will unleash a free morning newspaper like the ones pals pick up at railway stations in Europe these newspapers will feel the real squeeze especially on advertising, their main source of revenue.

    Equity…some really nice pre-listing PR. Their books will tell. But I’m giving seroius thoughts on buying on 7th.

    Btw, when is the electronic trading system kicking off at the NSE???

  4. gathinga

    am looking at the equity bank’s figures and cant fail to notice some things.

    They have customer deposits of up to 11bn. of this, 8bn has been lent out while the rest is sitting in other commercial banks….this is poor utilisation of capital. Could this be an indicator of an obsorbtion problem. As in Equity cannot lend off as fast as they’re collecting the cheap deposits. and why not keep the excess in in t-bills which pay better than interbank.

    All other indicative ratios are comming down from june 2005. ie. core capital/deposits etc

  5. The.Hanyeé

    Ah, nothing quite like getting your chicken “kaushwad” and going out using the very same oil running your engine…Kenchic might need to diversify, hehehe…

    Standard is just a washed-up gazeti with a cat furball for an internet business plan. For The Nation to so blindly (and stupidly) follow reads consternation to say the least…

  6. coldtusker

    What a poor strtegy! I agree with Mashatall coz I don’t give a **** about the other “sections”… esp Kenyans abroad who want the Financial Info.

    They do not even unfiy the online access (which is poorly presented, devoid of pictures) with a digital subscription!

  7. Ken

    On Nation and Standard. I know enough people who stopped buying the nation once the online version came up. They just read it for free in the office. Now that was affecting the circulation revenues. Granted the price is steep but they had to do something about it.
    Considering the alternative online news sources available, they made the right move, on priving..it’s too steep. @Mashtall you will note that allafrica has also moved a bulk of it’s content to premium.

    On KQ and the govt. Once again cheap tactics that benefit nobody, just when everyone expects cost of regional flights to fall KQ and co. pull a fast one to keep their monopoly. The OAU and GATT should investigate this.

  8. bankelele

    JabaBoeku: Pole, A lot of KQ profits are from Africa routes with little competition

    Mwasjd: I think finding Oil will ruin us (Oil curse)

    Mashatall: Am even sadder that the archives are now premium. As you say, it would be nice to be able to pay for just one magazine or article

    Ig-know-rant: Is alluvial the kind found in Central Africa? Charterhosue lawyers are sitting there gathering info

    Electronic trading system should be from September

    Gathinga: Equity needs to lend out more of its deposits, as they are more profitable than placements, by far

    Hanyeé: That kuku is unhealthy, but irresistble

    Coldtusker: I think newspapers (the world over) are grabbing at any/all revenue streams

    Ken: Some days I can flip through the newspaper in 2 min, and it’s not worth the 35/= (oh, it’s free in the office) but I do spend more time reading older papers, which are now PPV unfortunately


    You’re right, JabaBoeku. It is only competition that would save Entebbe-Nairobi travelers. But I recently learnt that the Kenyan government is refusing to give Ethiopian Airlines landing rights to fly the route (East African July 24-30). Kenyan authorities are all out to protect Kenya Airways from competition. This standoff may drag-on because it involves archrival competitors who are determined to penetrate each other’s market, but Kenya’s bureaucratic red tape would not let that happen. Kenyanomics blog will feature this topic tomorrow, Aug 10.

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