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Nairobi, Kenya — ESI-AFRICA.COM — 12 January 2011 – Kenya’s sole power distributor, Kenya Power and Lighting (KPLC) has revealed that its rights issue was 3.17% oversubscribed, and says the shares will start trading on the Nairobi Stock Exchange on 24 January.

KPLC had offered 488.6 million new shares in the rights issue. The company had previously said the issue was aimed at raising 9.5 billion shillings (US$120 million).

The rights issue is part of a restructuring of the company’s capital base. As a first step, it is redeeming preference shares held by the government, which paid a fixed dividend of 7.85%, and giving it ordinary shares instead.

All outstanding ordinary shares will then be split eight-for-one before the new shares go on sale.
The company had set the price for the new ordinary shares at 19.5 shillings, and said some of the proceeds from the sale would go to upgrade its grid.

The rights issue opened on December 1 and closed on December 22. KPLC is expected to give more details on the rights issue at a media conference later today. Shares in the company closed at 25 shillings yesterday.

The government will not participate in the rights issue, leaving it with a 50.1% stake. KPLC had entered into an underwriting agreement for 50% of the shares on offer. In the statement today KPLC said existing shareholders would be entitled to buy 20 new shares for every 51 held.

KPLC reported an 18% rise in pretax profit to 5.63 billion shillings (US$ 70 million) for the year ended 30 June, due mostly to improved financing costs and higher margins.