Press Release

CMA approves Crown Paints Kenya Plc rights issue

Nairobi, 7 May, 2021…The Capital Markets Authority (CMA) has granted approval to Crown Paints Kenya Plc to undertake a rights issue to raise Ksh711,810,000 by issuing and listing 71,181,000 new ordinary shares on the Nairobi Securities Exchange. The rights will be issued on the basis of one new ordinary share for every one existing share.

According to the Information Memorandum, the main aim of the rights issue is to give the company financial flexibility to mitigate the challenges posed by the ongoing Covid-19 pandemic and boost the growth strategy for the company. The Group’s management plans to use the rights issue funds to facilitate development of new products, retiring of current facilities, and funding regional expansion.

The CMA Chief Executive Officer, Mr. Wyckliffe Shamiah, observed that the disclosures made on the rights issue comply with the requirements of the Fourth Schedule to the Capital Markets (Securities) (Public Offers, Listing and Disclosures) Regulations, 2002, and contain information that will enable investors to make an informed decision on the rights issue.

Mr. Shamiah added that the Authority had reviewed the application for exemptions from complying with Regulation 4 of the Capital Markets (Take Over and Mergers) Regulations, 2002 in relation to the intention of the company’s major shareholders, who have undertaken to take up their full rights entitlements. They are also willing to take more than their initial entitlements subject to availability during the rights issue.

Crown Paints Kenya Plc is expected to make bi-annual updates to the Authority on use of the proceeds of the rights issue in line with the disclosures contained in the Information Memorandum.

ENDS

 

BACKGROUND INFORMATION ON THE CAPITAL MARKETS AUTHORITY

The Capital Markets Authority (CMA) was set up in 1989 as a statutory agency under the Capital Markets Act Cap 485A. It is charged with the prime responsibility of both regulating and developing orderly, fair and efficient capital markets in Kenya with the view to promoting market integrity and investor confidence. The regulatory functions of the Authority as provided by the Act and the regulations include: Licensing and supervising all the capital market intermediaries; Ensuring compliance with the legal and regulatory framework by all market participants; Regulating public offers of securities, such as equities and bonds and the issuance of other capital market products such as collective investment schemes; Promoting market development through research on new products and services; Reviewing the legal framework to respond to market dynamics; Promoting investor education and public awareness; and Protecting investors’ interest. For more information, please contact: Antony Mwangi, Manager Corporate Affairs & International Relations on This email address is being protected from spambots. You need JavaScript enabled to view it.

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