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Corporate Finance Advisory

We have extensive experience in the public and private sector, as well as transaction advisory skills and capital raising expertise. We have credibility with investors – including local and foreign institutions, and high net worth individuals. We perform the following roles:

  • Transaction advisory;
  • Private equity placements;
  • Balance sheet restructuring;
  • Financing arrangements; and
  • Fairness opinions

For more information on our corporate finance transactions, please see below:

Faida Investment Bank is proud to be the sponsoring stock broker for Nation Media Group’s Share Buyback. On Thursday 27 May 2021, the Capital Markets Authority approved the purchase of up to 10% of its issued and paid-up share capital as an open market share Buyback Programme in accordance with the provisions of the Companies Act.

Nation Media Group (NMG) Board has recommended a minimum price equivalent to the par value of an ordinary share and a maximum Buyback price of KES 25.00 per ordinary share (“Buyback Price”). The price is subject to Shareholder approval at the virtual Annual General Meeting which will be  be held on Friday, 25 June 2021. It is expected that the Buyback offer will open simultaneously with the opening of trade at the Nairobi Securities Exchange on Monday, 28 June 2021.

The Buyback offer is expected to close on the earlier of NMG buying up to 10% of its issued share capital or as at 3:00 pm on Friday, 24 September 2021 in accordance with the terms of a shareholder circular issued to shareholders.

Faida Investment Bank is delighted to be associated with the transaction and are optimistic that it will provide shareholders who wish to sell their ordinary shares the opportunity to do so at a premium to the weighted average price over the last 12 months.

For any questions on the Share Buyback call +254 20 7606031 / 33 or email us on nmgbuyback@fib.co.ke

Additional Notes:

A Share Buyback occurs when a company purchases a portion of its issued shares from its shareholders. It is one of the ways for a company to return funds to shareholders, effectively reducing the number of issued shares and providing shareholders with an alternative option to realize value from their investment.

About Faida Investment Bank

Faida Investment Bank is among the leading investment banks in Kenya and provides securities trading services such as portfolio creation and management, markets and institutional research, investment advisory, private equity placement and corporate finance advisory. Faida has an associated company in Rwanda, Faida Securities Rwanda Ltd.

About Nation Media Group

Nation Media Group (NMG) is a publicly listed company on the Nairobi Stock Exchange (NSE). It has operations in digital, print and broadcast media and serves audiences in Africa and globally.  The Group has recently launched its new digital brand Nation.  Africa with a mission to transform Africa through leveraging its largest digital footprint, reaching more than 40 million unique visitors monthly.

 

FREQUENTLY ASKED QUESTIONS ON SHARE BUY-BACK

What is a Share Buy-back?

A Share Buy-back is a transaction in which a company purchases a portion of its issued shares from its shareholders. It is also known as a share repurchase. Investors can think of Share Buy-backs as another way of returning capital to shareholders.

How does it work?

A Share Buy-back can be carried out through:

  1. The open market – shares in the market are repurchased through an exchange.
  2. Fixed price tender offer – repurchasing a fixed number of shares at a fixed price. The shares are usually bought back at a premium.
  • Dutch auction – instead of a fixed price the company offers a range of prices.
  1. Direct negotiation – the company negotiates with major shareholders to buy back the shares. (at times a large shareholder may require the repurchase owing to liquidity needs or in order to exit and such shares may be bought back at a discount.

The repurchased shares are either classified as treasury stock/ treasury shares or are cancelled.

Why is NMG doing a Share Buy-back?

Nation Media Group is carrying out the Share Buy-back on the open market to offer shareholders an alternative option to realise value from their investment from the shares bought back. This also retains optionality to benefit from potential improvement in future earnings and capital gains for shares not sold to the Company under the Buy-back.

What is the advantage to the current Shareholders of a

Share Buy-back? 

The Share Buy-back has the following possible benefits to the current shareholders:

  1. Shareholders who wish to sell their ordinary shares can do so on an open market basis and earn a potential return on investment (a premium to the weighted average price over the last 12 months).
  2. Shareholders who choose to sell a portion of their shares can benefit from a potential uplift in the capital return on their remaining shareholding.
  • Shareholders have the option to maintain their investment in ordinary shares instead of selling.
  1. The buy-back allows for purchased stock to be resold into the market at a later date at higher prices, resulting in potential gains for the Company. This also potentially provides an incentive to the management of the Company to improve firm value.

What effect will the NMG Share Buy-back have on their shares?

The Buy-back will reduce the total volume of NMG shares available for trading (by the number of shares bought back) and therefore may improve the earnings per share depending on the level of profitability, which could boost the share price.

What effect will the NMG Share Buy-back have on the performance of other shares on the NSE?

Investor perception on other counters following the Buy-back is difficult to predict. The Buy-back is likely to primarily influence the performance of the shares of the issuing company (NMG).

Will this lead to dilution of the individual shareholding of retail investors in NMG?

No, because the Buy-back will reduce the total volume of NMG shares available for trading (by the number of shares bought back). Therefore, investors who opt not to sell their shares would have a relatively higher percentage of ownership of the company’s shares as there would be fewer NMG shares in the market.

How long will the Share Buy-back run for?

It is expected that the Buy-back offer will open simultaneously with the opening of trade at the Nairobi Securities Exchange on Monday, 28 June 2021. The Buy-back offer is expected to close on the earlier of NMG buying up to 10% of its issued share capital or at 3:00 pm on Friday, 24th September, 2021 and in accordance with the terms of a shareholder circular issued to shareholders.

Is this the right time to do a Share Buy-back?

At present, positive sentiments on economic recovery following the rollout of vaccines has seen buy backs on the rise again internationally. For companies with adequate cash flow, excess cash can now be put towards a Buy-back in lieu of reinvesting.

Do you think other companies will follow suit and announce a Share Buy-back like NMG’s?

The share Buy-back will set a precedent in the Kenyan capital markets, that other companies can follow in future as it is the first Buy-back for a listed company. However, it would be difficult to predict exactly how other companies will respond to the Buy-back.

 

 

 

 

Faida & IMBC Deliver 12% Oversubscription for I&M Bank (Rwanda) PLC Rights Issue

We (Faida Securities Rwanda) and I&M Burbidge Capital, as the Joint Lead Transaction Advisors for the 2020 Rights Issue, are pleased to announce the successful completion of the transaction with the Rights Issue having closed with an oversubscription of 12%. 

The Rights Issue raised  7.9 billion Frw  (approx. Kshs 887 Million) at a share offer price of Frw 39.60 for a total 202,000,000 shares on offer. However, those applied for totaled 225,584,700 buoying the performance of the transaction by 112%.

I&M Bank (Rwanda) Plc undertook the Rights Issue to secure long-term funding to accelerate investment in technological platforms and bolster the Bank’s Tier 1 Capital Adequacy Ratio.

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According to Ms Rina Hicks, Chief Operations Officer at Faida Securities Rwanda an associate company of Faida Investment Bank said, “Despite the effects of the COVID-19 pandemic, we are proud to partner with the bank in this transaction and are optimistic about the Bank’s growth prospects. I&M Bank Rwanda has a track record of offering high Return on Average Equity and is a strong dividend counter.”

Wishing them success in the years ahead, Ms Hicks added, “We believe that going forward, growth will be driven by the Bank’s current strategy which largely focuses on increasing their MSME offering and leveraging digital banking to enhance efficiency and revenue diversification.”

Speaking about the transaction, Ms. Gauri Gupta, Director at I&M Burbidge Capital, said “We are delighted to have advised on this successful transaction. The advisory teams and the Bank’s transaction team worked extremely hard to complete this within the timeframes, and the highly successful outcome is a testament to the professional approach of the advisory teams as well as I&M Bank’s fantastic performance record and reputation in the market.”

I&M Bank Rwanda has grown steadily over the past five years and the results of this Rights Issue demonstrate the commitment by its shareholders to continue to be a part of the Bank’s sustainable growth story.

Please see the press release below:

I&M Burbidge Capital-Faida-Press Release

 

VSA Capital Faida Strategic Partnership

We are pleased to announce that we have entered into a strategic partnership with VSA Capital, an international investment banking and broking firm.

The partnership will enable both firms to leverage their broad range of advisory skills and deep knowledge of corporates and investors throughout Africa.

Andrew Monk, Chief Executive of VSA Capital commented “We are delighted with our new partnership with Faida that will make a real difference to the services we can offer our corporate clients and funders in Africa. The capabilities of VSA in London and Moshe Capital in Johannesburg will be enhanced by Faida’s market leading position in East Africa and give VSA Capital a greater presence in Africa than any other UK domestic broker. Combined with VSA’s office in Shanghai, it will create a formidable London-China-Africa axis that will be appealing to multinational clients operating in these regions.”

Rina Hicks, Chief Operations Officer of Faida Investment Bank commented: “Our partnership with VSA means that Faida and VSA will leverage our joint capabilities throughout Africa and particularly East Africa. We are excited about this partnership. At this crucial time, East African companies need access to capital and we believe that jointly engaging with global capital providers will positively contribute to greater access to capital as well as provide a wider range of innovative funding solutions.”

Please see the press release below:

VSA Faida press release draft final

 

Faida Completed Transactions

We have extensive experience in the public and private sector, as well as transaction advisory skills and capital raising expertise, and have credibility with investors – including local and foreign institutions, and high net worth individuals. Below is a list of all our completed corporate finance transactions to date.

Year Transactions Country
2020 I&M Bank Holdings Plc – Independent Financial Advisory for a potential buyout Kenya
2020 I&M Bank Plc (Rwanda) – Co Transaction Advisor for Rights Issue Rwanda
2020 RH Bophelo Limited – Listing by Introduction of a JSE Listed Company (Sponsoring Broker) Rwanda
2019 NCBA Group Plc – Independent Financial Advisor for the merger between NIC and CBA Group Limited Kenya
2019 Unga Group Limited – Independent Financial Advisor for takeover of the company Kenya
2015 Family Bank – Co Transaction Advisor & Placing agent for Corporate Bond Kenya
2015 Equity Bank Limited – Lead Sponsoring Broker for cross listing at the Rwanda Stock Exchange Rwanda
2012 CIC Insurance Group – Lead Transaction Advisor for Listing by Introduction Kenya
2012 CIC Insurance Group – Valuation of CIC shares for Listing by Introduction Kenya
2012 Unaitas Sacco – Transaction Advisor for the regularisation of the Sacco public offer Kenya
2008 Cooperative Bank of Kenya – Lead Sponsoring Broker for the Initial Public Offer (IPO) Kenya
2008 KCB Limited – Co transaction advisor & Lead Sponsoring Broker for Rights Issue Kenya
2008 KCB Limited – Co Transaction Advisor & Lead Sponsoring Broker for the Cross Listing Rwanda, Uganda, Tanzania
2008 KCB Co-Transaction Advisor for KCB Employee share ownership scheme Kenya, Uganda & Tanzania
2008 Safaricom Limited – Lead Sponsoring Broker for the IPO Kenya
2007 Olympia Capital Holdings – Lead Sponsoring Broker for IPO Kenya
2006 Diamond Trust Bank – Co-Lead Sponsoring Broker for Rights Issue Kenya
2006 Kengen Company Limited – Co-Lead Sponsoring Broker for IPO Kenya
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Public Issues/Advisory

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Combined Years of Experience of the Team

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