The Kenya Power and Lighting Company has changed from a Private Limited Company (Ltd) to a Public Limited Company (Plc), the Company Secretary has confirmed
“The Kenya Power and Lighting Company Limited has changed its name to The Kenya Power and Lighting Company Plc, following the due approval shareholders and on receipt of the certificate of change of name issued by the Registrar of Companies,” Imelda Bore, KPLC Company Secretary said in an announcement.
This will see the company change its name to Kenya Power and Lighting Company Plc. It will also mean a change in how the company is run. However, KPLC will still raise its capital through shares despite the change.
The company recorded a decline in revenue last year and had also warned that the same might happen during this financial year. The utility firm had warned that the revenue will decrease by about 25% from last year’s revenue.
Last year, the company issued a similar warning and ended up posting a 63.7% decline in net profit to Ksh 1.92 billion, which it attributed to increased power purchase and higher finance costs despite an increased customer base that saw its revenue rising by 4.23% to Ksh 125.8 billion.
The company’s current precarious financial position gives doubt to its ability to meet its obligations. In the last financial year, the Kenya Electricity Generating Company (KenGen) was demanding Ksh 1 billion in penalties for flouting the 40-day window credit terms. It is not clear whether that bill has been settled.
The Power Company was listed on the Nairobi Stock Exchange in 2010 but has been trading as a private limited company.
KPLC will now be able to quote its shares on the stock exchange unlike before when it could not. Initially, the company could be able to sell shares on stock exchange without having to consult the owners for selling and buying shares.
With the change, the government can own a large share of the company. This does not happen in a private Ltd company as the majority of the shares will be with a family or with private individuals. In a public Limited Company, the shares can be transferred freely.
KPLC will now focus on the provision of services than on profit as it was before. A Public Limited Company has a greater impact on the public as the shares are public. On the other hand, the Ltd companies have no impact on the public as it can just be a household business.