The anchor shareholders of Quickmart can sell up to 800 million shares or 40 percent of their remaining stake without restriction, following the retailer’s initial public offering (IPO) after the markets regulator agreed to a lock-up rule that only covers part of their holding.
The Capital Markets Authority (CMA) requires controlling shareholders to hold on to their stake for at least two years after listing, to reassure prospective investors that insiders are not looking for a quick exit or dumping struggling companies on the public.
Disclosures by Quickmart in its IPO information memorandum show that the selling shareholders will be required to hold on to at least 60 percent of their shares for the next two years.
Quickmart’s current owners comprise Mauritius-registered private equity fund Adenia Partners, the founders of Quickmart and Tumaini supermarkets and Chief Executive Officer Peter Kang’iri.
They are currently offloading two billion shares in the IPO, equivalent to a 50 percent stake, at a price of Sh7.50 a unit. Their shares are held through an investment vehicle known as Sokoni Retail Kenya Limited (SRKL).
‘The selling shareholder (SRKL) has agreed that, for a period of 24 months from the listing date, it will not, without the prior written consent of the lead placing agent, co-placing agent and the issuer and the approval of the CMA, directly or indirectly sell or transfer ordinary shares representing 60 percent of the total remaining ordinary shares envisaged to be held by it immediately after listing date,’ reads the information memorandum in part.
“The balance of such remaining ordinary shares not subject to the lock-up undertaking,” the document added.
The partial lock-up means that they can sell an additional 800 million shares in the next two years should they wish to do so. The less restrictive lock-up requirement mirrors that imposed on the Family Bank founder Titus Muya and his associates when the lender listed by introduction in June.
The CMA granted Mr Muya and his associates leeway to dilute their shareholding of 35.6 percent in order to allow them to meet the Central Bank of Kenya (CBK) regulatory cap of 25 percent without flouting listing rules.
In this year’s other IPO of Kenya Pipeline Company in March, the National Treasury was locked into holding its remaining 35 percent stake for at least 24 months after disposing a 65 percent stake to the public for Sh106 billion.
The Quickmart sale, which opened this week and runs until October 30, is targeting Sh15 billion and values the company at Sh30 billion.
Going into the listing, Adenia holds a 50.79 percent stake in SRKL, the family of Quickmart founder the late John Kinuthia 31.83 percent, the founders of Tumaini Supermarket 12.02 percent and Mr Kang’iri 5.36 percent.
Presuming the offer is fully subscribed, Adenia’s stake will drop to 25.4 percent, with the stakes of the Quickmart and Tumaini founders falling to 15.9 percent and 6.01 percent respectively. Meanwhile, Mr Kang’iri’s holding will halve to 2.68 percent.
Although PE funds usually have an investment cycle of between seven and 10 years, Adenia has said that it remains committed to staying on board and supporting Quickmart’s management through its next growth phase.
The fund acquired its stake in the retailer between 2018 and 2019, after buying majority stakes in Quickmart (51 percent) and Tumaini (55 percent) and then merging the entities under the Quickmart brand in 2020.
The only exceptions to the 60 percent lock-up of their shares post-listing include transfers of shares to affiliates and related Adenia funds, disposals required by law, acceptances of a general offer, permitted encumbrances, and transactions approved by the placing agents the CMA or the Nairobi Securities Exchange (NSE).
The International Finance Corporation (IFC) -the World Bank’s private investment arm- has also been exempted from any lock-up restrictions after coming in as the offer’s cornerstone investor, subject to approval by its board of directors.
Global practice usually restricts Cornerstone investors who commit to buying shares before an IPO opens restricted from selling for a fixed period after listing, although this is usually shorter than two years. This bet on the retail sector will see the IFC acquire 258.67 million shares in Quickmart, representing about 13 percent of the offer shares, and an ultimate stake of 6.5 percent in the company.
‘Any IFC purchase of offer shares would be made on the same terms and conditions as all other investors in the offer,’ said Quickmart in the information memorandum.
‘Notwithstanding IFC’s interest in the proposed investment, IFC may sell its shareholding at any time in the future.’
In the case of Family Bank, Mr Muya and his associates were granted a concession by CBK to hold a combined stake of up to 31.9 percent, meaning that a sale of a 3.7 percent stake would be necessary in order to comply with the concession before later moving to full compliance of a 25 percent holding.
They tried to dilute their stake in the bank previously by sitting out capital raising ventures such as the private placement conducted in 2025.
At the time of listing, Mr Muya’s direct stake in the bank was disclosed at 4.42 percent. Daykio Plantations, a real estate company owned 91 percent by Mr Muya and nine percent by the Estate of Leah Wanjiru, held a 9.53 percent stake in the lender.
Other members of his family, including the Estates of Rachael Njeri Muya and Leah Wanjiru Muya, held a combined stake of 19.5 percent. A further 2.22 percent is held by Kenya Orient Life Assurance and its sister company Kenya Orient Insurance, which are also associated with the bank’s founder.