The planned acquisition of BOC Kenya Plc by Carbacid Investments Plc and Aksaya Investments LLP has lapsed, following years of legal hurdles that stalled the acquisition process.

The two firms had initially made an offer in November 2020 to acquire up to 100 per cent of the issued ordinary shares of BOC Kenya, but a shareholder appeal against regulatory approval ultimately derailed the deal.

The deal faced opposition from minority shareholders who contested the offer price of Sh1.2 billion (Sh63.50 per share), arguing that it undervalued BOC Kenya. A notable dissenting shareholder was former BOC chair Ngugi Kiuna, who increased his stake to 11.2 per cent, granting him the power to block a mandatory buyout.

Expanding market reach

BOC Kenya, a leading supplier of industrial, medical, and special gases in East Africa, was seen as a strategic acquisition that would consolidate the industrial gas supply market in the region. Carbacid and Aksaya aimed to leverage BOC Kenya’s extensive infrastructure and market presence to enhance operational efficiencies and expand their market reach.

However, the deal faced immediate challenges when, in March 2021, a BOC Kenya shareholder filed an appeal with the Capital Markets Tribunal (CMT) against the Capital Markets Authority’s (CMA) approval of the offer. This legal action effectively put the takeover on hold, delaying what was expected to be a swift acquisition process.

The CMT eventually dismissed the appeal on August 29, 2024, upholding the CMA’s initial approval of the takeover. But by that time, the conditions outlined in the takeover offer document had not been met by the stipulated Long Stop Date, leading to the lapse of the offer.

“The directors of BOC Kenya Plc (the Board) hereby advise shareholders and the investing public that they have been informed by Carbacid Investments Plc and Aksaya Investments LLP (together the Offerors) that the take-over offer for all the shares of BOC Kenya Plc (BOC Kenya) made pursuant to the takeover offer document dated 5 January 2021 (as updated on 12 February 2021) has lapsed on its terms and will NOT proceed,” said R.T. Ngobi, Company Secretary of BOC Kenya.

The lapse of the deal marks the end of a protracted process that had seen BOC Kenya at the center of one of the longest takeover battles in recent years. Legal bottlenecks and regulatory timelines played a critical role in shaping the outcome, raising concerns about the ease of executing corporate acquisitions in Kenya’s public markets.

While the lapse signals stability for BOC Kenya’s current shareholders, it also raises questions about the company’s future strategic direction. Market analysts suggest that the failure of the takeover bid could see BOC Kenya explore alternative growth strategies or potential partnerships to strengthen its market position.

With the acquisition off the table, Carbacid and Aksaya will likely re-evaluate their expansion plans in the industrial gases sector, while BOC Kenya navigates its next phase independently.hoculium condam auciae, P. Vatilinat re coenatus movenius labentemus con hostropublin ta nonfirmistis et L. Untemun teliam consus cat rem haliussus