City Trust of Kenya Shares Head for Record High: Nairobi Mover
City Trust Ltd. (CTRL) surged toward a record after a newspaper report said the Kenyan investment company’s proposed merger with a bank will boost its market value.
The stock surged by the maximum daily limit of 10 percent to 440 shillings by 2:03 p.m. in the capital, Nairobi. A close at this level will be the highest since May 20, 1997, when Bloomberg began compiling data on the stock. About 52 percent of the three-month daily average volume of shares were traded.
The proposed merger with Nairobi-based I&M Bank Ltd. may be worth 29 billion shillings ($330.7 million), Business Daily reported, citing documents from the companies. City Trust has a market value of 2.52 billion shillings now.
“Based on 2011 earnings, the company would easily come into the market at a level of between 80 shillings and 100 shillings per share,” Francis Mwangi, head of research at Nairobi-based Standard Investment Bank Ltd., said in a phone interview.
Under the planned merger announced on Dec. 24, City Trust shares will be split five times, placing the current market price at 88 shillings.
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