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The Ball moves into the court of BOC Shareholders on the takeover bid

NAIROBI, Kenya, Feb 24 – The offers from Carbacid Investments Limited and Aksaya LLP to acquire all the issued shares of BOC Kenya Plc opened on Friday 19 February 2021 following the circulation of the offer documentation to shareholders of BOC.

Since the issue of the Notice of the Intention by the offerors to acquire the BOC shares at the end of 2020, the parties have been preparing the documentation prescribed by the regulations to enable shareholders to make an informed decision on whether or not to accept the shares.

The offerors have prepared a takeover offer document laying out among other things the terms and conditions of the offer. The takeover offer document is issued together with the form of acceptance through which shareholders that choose to accept the offer will indicate their acceptance.

The Board of BOC as required by the Capital Markets Takeover Regulations appointed an investment bank, Dyer and Blair Investment Bank to undertake an independent evaluation of the offer and advise shareholders as to whether the offer was fair. Dyer and Blair were selected through a competitive process.

The verdict of Dyer and Blair is that the fair value of a share of BOC is at least Kes 91.76. This is 44.5% higher than the 63.50 on offer. The independent adviser’s opinion in its entirety has been dispatched to shareholders. It is also available on the website of BOC.

After interrogating the opinion of the Independent Adviser and separately considering the operating environment and future prospects of the company, the Board of BOC Kenya declined to recommend the offer to shareholders.

Shareholders have also been provided with the Termination of Services agreement entered between the offerors and BOC Holdings as well as the irrevocable undertaking to accept the offer issued to the offeror by BOC Holdings.

Armed with all the information required under the Takeover Regulations, the ball now moves into the court of the shareholders of BOC who must consider the offer in their particular circumstances and then make a decision whether or not to accept the offer in respect of their shareholding.

It is important to note that BOC’s major shareholder BOC Holdings, part of the Linde Group who hold 65 per cent of BOC has issued an irrevocable undertaking to the offerors to accept the offer. Given that the offer is not conditional on the offerors achieving a certain level of acceptance, it means that the offerors open the offer with the assurance of acquiring at least 65 per cent of the shares. The only other hurdle that they will have to get past will be obtaining requisite regulatory approvals and in particular approval from the Competition Authority of Kenya.

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The offer closes on 6 April 2021 and is expected to have been completed by 31 July 2021.

In the interim, BOC continues to post strong performance with the unaudited profit before tax being up 73% in 2020 compared to the prior year’s audited results. Marion Gathoga – Mwangi, BOC’s Managing Director has attributed the firm’s strong performance to its expansion strategy and introduction of new products and services in both private and public healthcare facilities.

The continued demand by regional Governments to improve access to medical gases to the last mile and outbreak of COVID-19 pandemic has created market opportunities for the firm as there has been a steady growth in the healthcare sector in both liquid and packaged gases and customer engineering services which have been on the upward trend.


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