Quickmart Supermarket’s public share offer valued at KSh15 billion has prompted the National Assembly Public Investments Committee to question whether the Capital Markets Authority (CMA) is providing adequate safeguards for ordinary Kenyan investors.
The transaction involves Sokoni Retail Kenya Limited selling two billion existing shares at KSh7.50 each, with applications totalling KSh18.41 billion, representing a 22.7 per cent oversubscription.
Committee chair Pokot South MP David Pkosing warned that investors could suffer losses if they do not fully understand the retailer’s financial position and risks, and said “as the market regulator you have an obligation to protect Kenyans from potential loss of funds.”
Woman Representative Esther Passaris asked whether prospective investors had been adequately informed about the arrangement, noting that the sale is described as a partial exit by private-equity investor Adenia and the company’s founders.
Members drew parallels with the collapses of Uchumi and Nakumatt supermarkets, arguing that past failures in the retail sector should inform the assessment of similar investment opportunities.
CMA Chief Executive Officer Wyckliffe Shamiah defended the regulator’s assessment, stating “the SME (Quickmart) is not heavily reliant on debt, as the bulk of its funding is internally generated. The proposed share sale has also met the other requisite thresholds.”
Shamiah also addressed audit queries concerning temporary staff engagements and the procurement of medical insurance brokerage services, attributing the staffing arrangements to personnel shortages and saying recruitment had been undertaken with National Treasury approval, while the insurance brokerage procurement complied with the law.
The committee’s intervention underscores the distinction between secondary share sales, which allow existing shareholders to realise investments without providing fresh equity to the issuing company, and primary issues that raise new capital for the business.
