Listed firm Nairobi Business Ventures (NBV) shareholders have approved a Ksh83 million investment by Dubai-based Delta International FZE at the firm’s annual general meeting (AGM).
The shareholder approval of the Ksh83 million investment will result in Delta International FZE owning an 84 percent stake in the shoe vendor, pending all regulatory approvals.
Shareholders additionally approved splitting the shares into two which should result in greater liquidity in the stock.
The shareholder approval now paves the way for NBV to venture into new businesses including trading and the manufacturing of sustainable products.
“NBV will greatly benefit from Delta International FZE vast experience in trade, services and manufacturing of sustainable products. We welcome this new partnership that will enable us diversify into these new and promising sectors,” said NBV Chairman Sheth Kumar Harshard in a statement.
NBV was established as a leather products retail chain operating under the brand name “K Shoe” but has made the strategic decision to exit the retail businesses, which is facing numerous challenges. Instead NBV will enter venture into trade and the manufacturing of sustainable products.
“NBV’s outlook is bright and we plan to become a major manufacturer of sustainable products in the coming years. The partnership with Delta International FZE will give us a firm footing to achieve this goal,” said NBV CEO Abotula Vasu.
The Ksh83 million investment will additionally result in the creation of 415 million new shares tradable on the Nairobi Securities Exchange (NSE).
ABC Capital were the transaction advisors and MW & Company Advocates LLP were the legal advisors.
In October, The Nairobi Securities Exchange (NSE) suspended the trading of shares of NBV, to pave way for the transaction as the company sought to raise capital away from the bourse.
The company also issued a profit warning in March. Until recently, the vendor has been facing financial problems exercabated by seizure of inventory by landlords aggrieved by piling rent arrears.
It is expected that the deal will ease the firm’s financial problems.
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