NAIROBI, Kenya Nov 17 – Lifestyle clothing dealer Deacons Kenya Limited has kicked off its Public Offer (PO) with the floatation of 12.8 million new shares at Sh62.50 per share.
The PO seeks to raise Sh800 million in fresh capital, which will enable Deacons fund its expansion and diversify its brands across the region.
The offer, which runs through to November 30, will add a maximum of 1,500 new shareholders into the company’s registry.
Qualified institutional investors will be allotted 5.76 million shares (45pc), Individual and Corporate investors 3.84 million shares (30pc), Existing shareholders, 2.56 million shares (20pc) while staff will be allotted 640,000 shares (5pc).
Individual and corporate investors will be expected to take up a minimum of 2,400 shares per applicant or Sh150,000.
Speaking at an investor briefing on Wednesday, Deacons Chief Executive Muchiri Wahome said the money raised would be used to grow the company’s brands as well as expanding to Rwanda as part of its pan-African growth strategy.
“We have ambitious plans for growth at Deacons. We expect to significantly increase the number of stores across the region in the next five years and at the same time will continue to pursue new opportunities to expand and diversify our portfolio of brands to ensure our customers are kept happy, satisfied and engaged,” Mr Wahome said.
Deacons is a well known lifestyle brands retailer with such brands as Woolworths, Truworths, Identity, and 4U2, Mr Price, Mr Price Home, Angelo, Adidas and Life Fitness in its stable.
The company is the first lifestyle brands retailer to raise capital in this form from the public.
Deacons currently has 23 retail outlets in Kenya, Uganda and Tanzania, which Mr Wahome revealed that the company plans to double to 54.
Turnover at the company has been on upward trajectory in the last five years posting Sh442.3 million in 2005 (five stores) and a projected Sh1.9 billion in 2010 (25 stores). Net income has also been soaring with Sh43.95 million in 2005 and Sh79.60 million in 2009.
Deacons Chairman Peter Njoka told investors the company is mulling future listing on the Nairobi Stock Exchange within the next 12 months subject to regulatory approval.
“It is the intention to list the Company’s shares on the Nairobi Stock Exchange at a later date provided the company complies with the necessary regulatory and other requirements for a listing. We are confident that this issue will be a success,” Mr Njoka said.