Scangroup of Kenya Gains Most in 7 Years as WPP Boosts Stake
Scangroup Ltd., East Africa’s biggest marketing agency by sales, made the biggest one-day gain since 2006 after London-based WPP Plc (WPP) made an offer to increase its stake.
The stock surged 12 percent to 72 shillings by the close in Nairobi, the capital, the largest advance since September 2006. Trading volume was 20 percent of the three-month daily average. WPP, the world’s biggest communications company, will increase its holding in Scangroup to 50.1 percent from 33.62 percent, the companies said yesterday.
“There is a lot of attention on the African advertising segment,” Rufus Mwanyasi, head trader at Nairobi-based Canaan Capital Ltd., said by phone. Industry “growth right now is on digital advertising and market research and WPP will benefit from this.”
Under the transaction, companies including Ogilvy Africa Ltd. and Hill & Knowlton East Africa Ltd. will become wholly owned units of Scangroup, according to the Kenyan company’s statement.
Shares in Scangroup have underperformed the FTSE NSE 25 Share Index this year, gaining 5.1 percent, compared with the gauge’s 30 percent climb.
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