The AccessKenya Group board of directors has recommended that its shareholders accept the Ksh3-billion (R355-million) Dimension Data bid to take over 100% of the shares of AccessKenya.

This follows the formal approval by the Capital Markets Authority (CMA) last week, after it reviewed a Shareholders Circular from the AccessKenya Group Board. The circular states: “Having considered the valuation conducted by Kestrel Capital (East Africa) Limited, the Board of Directors of AccessKenya recommends that the terms of the Offer should be accepted by AccessKenya Shareholders.”

Last month, the AccessKenya Board appointed Kestrel Capital to conduct an independent valuation of its business, as required under the provisions of regulation 10 of the Take-Over Regulations. The Shareholders Circular also states that “The IFA (Independent Financial Advisors) has confirmed that, based on its assessment of the recent trading price of AccessKenya shares on the NSE, the balance sheet, and the profit forecasts of AccessKenya, the offer is financially adequate, incorporating a fair take-over premium and, as a result, should be recommended to the shareholders to take up.”
Dimension Data will pay AccessKenya shareholders Ksh14.00 per share for 218-million ordinary shares – a 42% premium on the AccessKenya price of Ksh9.85 closing price on Friday 3 May 2013.

AccessKenya shareholders will also receive a final dividend of Ksh0.30 per AccessKenya share proposed by the AccessKenya board in respect of the year ended 31 December 2012.

Daniel Ndonye, Chairman of the Board of AccessKenya, says: “We are pleased to recommend the Dimension Data offer to our shareholders. The Board of Directors believes that the time is right for the business to move into the ownership of a large organisation such as Dimension Data. The Group has a vast global footprint and is wholly-owned by NTT, the largest telecommunications company in the world by revenue.

“The AccessKenya brand is one of the most respected brands in the regional IT industry and is being acquired from a position of strength. This historic transaction provides good value. I encourage our shareholders to exercise their rights by accepting this Offer which places a premium on the share value of more than 40%.”

The AccessKenya Group Board of Directors has also recommended that shareholders vote in favour of de-listing, which will take place in December if the offer becomes unconditional in all respects. After the delisting, AccessKenya will be merged with Internet Solutions in Kenya under the AccessKenya brand although the IS brand will continue to also operate in the Kenyan market. Internet Solutions (IS) is a wholly-owned Dimension Data company.

“AccessKenya and IS have developed a strong partnership within Kenya for four years, working together to serve Kenyan clients,” says Saki Missaikos, MD of IS. “An expanded presence for IS means AccessKenya clients and existing IS, and Dimension Data clients will benefit from an increased depth of service and quality of the solutions and services which will be available over time within the local market.”

With Ksh1.9 billion in annual revenue for the 2012 financial year, with projected revenue of around Ksh2 billion for 2013, AccessKenya is one of the largest internet service providers in the East Africa region.