KENYA – Directors at WPP Scangroup have approved the sale of 100% of its shareholding in West and East African business sending its shares up 23 per cent.
The assets to be sold include its shares in Millward Brown East Africa Ltd, Millward Brown Nigeria Ltd and Millward Brown West Africa Ltd, the group said in a public notice.
Additionally, WPP will also sell its shareholding in Research and Marketing Group Investment Limited.
It will also sell its Global Kantar Group to Bain Capital Group.
Kantar TNS operates in Nigeria and Kenya; the primary markets for WPP Scangroup. It also conducts activities in other countries including Senegal, Cameroon, Cote d’Ivoire, and Ghana.
Shares for Scangroup in RMGIL amount to 80% of the total ownership. The sale of Millward Brown Companies and RMGIL will generate approximately KSh5 billion after costs and taxes.
A notice from the company secretary reveals that Scangroup will pump proceeds from the sale into expansion and capital needs.
Furthermore, 40% of the proceeds will be paid out as a special dividend to shareholders.
“The sale will realize approximately KSh5 billion (US$50m) after estimated tax and costs. The consideration has been arrived at under a global competitive auction process carried out by WPP Plc.” announced Reuben Mwangi.
“The board has considered the use of the proceeds from the disposal taking to considerations potential expansion and capital need and subjects to completion expects that at least 40% of the net proceeds shall return to shareholders in the form of a special dividend.”
The company said it expected a net Ksh5 billion (US$50 million) from the sale, with 40 per cent of that going to shareholders in a special dividend.
The transaction is not complete as it awaits the finalization and execution of the sale agreement.
The deal also awaits shareholder and regulatory approval as well as the finalizing of the Global transaction.
Meanwhile, the company has urged shareholders to exercise caution when trading its shares due to the ongoing transaction.
