CMC shares face further ban on bourse

January 25, 2012
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NAIROBI, Kenya, Jan 25 – The Capital Markets Authority has extended the suspension of CMC Holdings Limited from trading at the Nairobi Securities Exchange (NSE) for another 21 days.

The extension takes effect on February 3 when the initial 90-day suspension expires.

While allowing the board of directors an opportunity to resolve disagreements at CMC, the Capital Markets Authority intervened by suspending trading of the company’s shares on the NSE to enable the investing public an opportunity to get a true picture of affairs at the auto-dealer.

Since then, the CMA conducted a preliminary investigation that led into a further comprehensive and independent forensic audit, while also facilitating several roundtable discussions between the board of directors and the management of CMC eventually resulting in unlocking the company operations.

CMA had appointed Messrs Webber Wentzel (South Africa) to conduct independent forensic investigations into financial operations of the company.

“The investigations are progressing well and significant ground has been covered and we are in the final phase and a report is expected to be submitted to the authority within a week’s time,” CMA Chief Executive Stella Kilonzo said.

She added that the authority is awaiting a report from forensic investigations commissioned by CMC to determine how the company contracted clearing and forwarding services.

“The authority wishes to assure investors that the lifting of suspension from trading of CMCH’s shares at NSE will be considered upon the conclusion of the review of the investigation reports which the Authority expects to receive shortly,” Kilonzo noted.

The board of CMC is required by CMA to develop and implement strategies that will ensure its compliance with good corporate governance guaranteeing its proper function.

Kilonzo reassured that the prime concern of the authority was to ensure that the overriding interests of the investing public are protected.

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