Mr Peter Munga. FILE PHOTO | NMG Businessman Peter Munga is challenging the findings of a Mauritian commission of inquiry whose report said he bought 452.5 million shares of Britam Holdings in a deal that left the island nation with a Sh3.9 billion loss.
Mr Munga said the transaction was a willing-seller-willing-buyer deal and disowned reports indicating he would pay an extra Sh3.9 billion.
The commission said he bought the shares for Sh7.1 billion even though there were rival higher bids of Sh11 billion each from South Africa’s insurance firm MMI Holdings and Barclays Bank (now Absa Group).
Reports indicated that Mr Munga had agreed to match the offers of South African multinationals before buying the stake at Sh7.1 billion.
“Our client’s investors and himself never agreed to buy British American Kenya Holding Limited’s stake in Britam for Rs4.3 billion (Sh11 billion),” Mr Munga said through law firm Richard Muhereza & Associates in a letter to the Attorney-General of Mauritius.
“Our client bought the shares on a willing buyer, willing seller basis from the government of Mauritius and fully paid for them.”
The Britam shares were seized by Mauritius in 2015 from its citizen Dawood Rawat, whose Sh71 billion Ponzi scheme was exposed, piling pressure on the government to sell his assets in Kenya and other jurisdictions to compensate investors and policyholders.
After buying the shares, Mr Munga would later sell them in two tranches.
The businessman says he was not given a full hearing before the commission of inquiry released its findings, adding that the findings have blemished his more than 50-year entrepreneurship record.
Mr Munga reckoned that he bought the shares at a premium based on Britam’s prevailing share price at the Nairobi Securities Exchange when he closed the deal in June 2016 when the stock averaged Sh14 a piece.
“Our client and his investors paid a hefty premium of Sh16, a price over and above the market price,” said Richard Muhereza & Associates.“Today, more than five years after the purchase, the price of Britam share is Sh8, which is half what our client paid for.”Mr Munga through his lawyers said the transaction was done to protect Britam shareholders.“The decision to protect Britam was reached because at that time the Government of Mauritius was desperate to raise money to pay SCBG/BAM policyholders while diluting and destroying the value of Britam shares since the share price was in freefall,” the law firm wrote.Britam’s shares were trading at around […]