Limuru Tea Gets Letter of Intent from ekaterra Tea to Acquire 100% Stake
Limuru Tea Company Ltd, one of Kenya’s agricultural firms engaged in growing green leaf tea, has received a notice of intention from ekaterra Tea Kenya to acquire a 100 per cent stake in the company.
Ekaterra Tea Kenya Plc owns a 52 per cent stake in the Nairobi-listed Limuru Tea Plc. Limuru Tea owns 282 acres of tea plantations in Limuru.
According to Limuru Tea, ekaterra Kenya has proposed to make a cash offer to acquire up to 100 per cent of the ordinary shares in the capital of Limuru TeaPlc that are not already legally or beneficially owned by the offer.
“The offer will be open to all remaining shareholders of Limuru Tea Plc, and ekaterra Kenya will only acquire additional shares from those shareholders who express their wish to realise their investment in Limuru Tea Plcby selling their shares to ekaterra Kenya,” Limuru Tea said in a notice the shareholders.
In addition, ekaterra has stated that it has no plans to delist the company from the Nairobi Securities Exchange and has not set any minimum threshold for acceptance for the offer.
“Further details of the proposed offer will be issued through the requisite announcements and documents that ekaterra Kenya will issue pursuant to the provisions of the Capital Markets (Take-overs and Mergers) Regulations.”
ekaterra, hosts a portfolio of 34 tea brands, including Lipton, PG Tips, Pukka Herbs and TAZO and generated revenues of 2 billion euros (KSh250 billion) in 2020.
“Following the engagement with the Capital Markets Authority, ekaterra Kenya (Unilever Tea) is meeting a regulatory obligation under the takeover regulation on behalf of its parent company Puccini, to make a mandatory offer for all the voting shares not currently legally or beneficially owned by Ekaterra Kenya,” Unilever said.
Limuru Tea Company Ltd posted a pre-tax loss of KShs 14.2 million in the year ended 31 December 2021, compared to a KShs 7.9 million pre-tax loss in the prior year.
The declined performance was largely driven by Inflationary pressures and lower production volumes realized in 2021 compared to 2020 due to lower rainfall by 40 per cent.
In 2021 the Company produced 3,207,330 (2020 3,882,430) kilograms of green leaf, which in turn was manufactured into 745,790 (2020 844,103) kilograms of black tea. Green Leaf and black tea reduced by 17 per cent and 12 per cent, respectively, in 2021.
Between Apr 1 – Jul 6, 2022, the company has traded a total volume of 8,000 shares—in 9 deals—valued at Ksh 2.63 million over the period, with an average of 127 traded shares per session.
The current share price of Limuru Tea Company Limited is Ksh 320.00 per share as of June 27, 2022, on the Nairobi Securities Exchange (NSE).