Foreign investors now hold the majority stake in the self-listed Nairobi Securities Exchange (NSE) Ltd after stock brokers, notably Shah Munge and Partners, sold significant stakes in the past one year.
The overseas shareholders owned 50.42 per cent as at the end of June compared to just 7.07 per cent by end of first half 2017.
By December 2017, the foreigners held 47.97 per cent before raising this in the six months to June.
Shah Munge, once a major broker, who got ejected as an active trading participant some years back even as it remained a shareholder, is no longer among the top 20 investors at the company that is now self-listed.
“The selling of shares that has taken place in the course of the last one year is in line with what is happening even within other listed companies. Kenyans have sold shares for various reasons including taking profits. Stockbrokers have also sold some of their shares as well,” said Mr Job Kihumba, an executive director at Nairobi-based Standard Investment Bank.
Currently, less than half or 11 of the 24 trading participants are among the top 20 shareholders of the self-listed firm. Of the 11, three of the companies are no longer active trading participants having been suspended for one reason or the other.
The three include Discount Securities, Nyagah Stockbrokers and Francis Thuo and Partners.
The eight active participants on the list of the top 20 investors include Sterling Capital, ABC Capital, Old Mutual Securities, Kingdom Securities, Renaissance Capital (Kenya), Dyer and Blair Investment Bank, Faida Investment Bank and NIC Securities.
“The Capital Markets Authority master plan envisages investors selling their shares to foreigners up to 100 per cent.
Whether it is a good or a bad thing is debatable. Obviously it is the foreigners who have the money to buy and so they have been increasing their stake,” said Mr Kihumba.