KenGen Seeking KES 5.8Bn Refund from Government

Equities
The equities market registered losses on both indexes, replicating a lacklustre performance realised earlier in the week and plunging the market further into the red, with the NSE All Share index slumped by 0.07% to close at 143.51; despite six sectors trending north. The NSE-20 share index followed suit, dropping by a significant 0.74% to close at 3799.57 points, while the NSE 25 Share Index recorded a decline by 0.167% closing at 4103.51 points. Market Capitalization failed to fare any better contracting by 0.07% to close at KES 2,023.44 billion while equity turnover bucked the trend and increased by 89.78% to close trading at KES 0.953Bn. Market breadth only further illustrated the bourses poor performance with decliners dominating the market at 14:23.
Kenya Electricity Generating Company is seeking a KES 5.8Bn refund from the government for the financing of geothermal wells that fed into the grid in 2014. The NSE-listed company claims that the outstanding amount, which is equivalent to 21.8% of sales for FY16 (ended June), was a direct result of the funding of the steam wells at Olkaria in Naivasha on behalf of the Ministry of Energy and Geothermal Development Company (GDC).
Read: KenGen Gets A Blow as Share Price Falls Below Rights Issue Price
The ministry officials announced that the government – who owns a 70% stake in the company- would settle dues owed to KenGen, with the said amount having favourably supplied an additional 280 megawatts onto the national grid. Meanwhile, the electricity generating company is still undergoing a rights issue to raise approximately KES 28.79Bn – in new capital – by offering a two for one entitlement ratio that closes on Friday 10th June. The government is set to take up 70% of the transaction, through some of the loans on-lent by the government. The rights issue offer price is KES 6.55, the counter’s closing price is KES 6.75.
Equity Market Highlights
Equity Group Holdings Ltd (NSE: EQTY) was the most actively traded stock today accounting for 25.98% of the total market value traded activity. East African Breweries Ltd (NSE: EABL) also registered high levels of activity, accounting for 22.71% of the total market turnover.
Standard Group Ltd (NSE: SGL) topped the gainers list, appreciating by 9.35% to close the day at KES 29.25. Kapchorua Tea Co. Ltd (NSE: KAPC) went up by 8.28% to close the day as the second best performer at KES 85.00. Flame Tree Group Holdings Ltd (NSE: FTGH) emerged as the top loser of the day, plummeting by 8.33% to close at KES 6.60. E.A Cables Ltd (NSE: CABL) similarly lost ground by 4.38% to close at KES 6.55.
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