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Centum pays out KSH 1 billion to employees
Rank: Member Joined: 6/15/2013 Posts: 301
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lochaes wrote:mawinder wrote:lochaes wrote:Cash flow issues at Two rivers? Why/link? material suppliers have not been paid for a while now. No link. word on the ground DJ and Mworia were very optimistic that mall would be open in September...that's two months back now. If you pass by the project it looks no where near completion. Maybe the slow down in completion may be a reflection of cash flow problems. And to me that mall seems a little bit out of the way from town. Why would I pass muthaiga mini market, village market, ridgeways mall and the new rosslyn Riviera and ciata city coming up to do grocery shopping etc when I can do all that in these malls that I have passed. They better have something special to pull in the clientele.
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Rank: Elder Joined: 7/22/2009 Posts: 7,570
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VituVingiSana wrote:mv_ufanisi wrote:target1360 wrote:VituVingiSana wrote:Why would James Mworia (& CK) have bought Centum shares in the 60s [or so he says] if he knew about the drama? Naikuni/Mbugua stayed away from KQ shares coz they knew about the rot.
Mworia has much more to lose with his investment in Centum at the 60-ish entry price. maybe we should ask where the money to buy at sh 60 came from,just maybe Likely came from the bonus pool. being a large shareholder and having board seats often means that you are likely to benefit from skewed company deals that other shareholders know nothing about. remember the CMC guy Peter Muthoka and Andy Forwarder's deal? Andy Forwarders supposedly overcharged CMC by 1.5 billion because Peter was part of the board and could direct contracts to his company. This is the kind of stuff ordinary shareholders never know about. Don't compare yourself with significant shareholders and insiders if you're not sure about the backroom board deals. Peter Muthoka had voting clout [20% or so shareholding] on the board. His 'loss' on his 20% was adequately covered by the shady deals. The guy with the most to lose in Centum is CK with 25-30% if anyone else does anything fishy. @vvs - You are very familiar with Merali deals. This is how these things work. I set up company A which is publicly traded in the NSE. I sell all of you shares but I retain controlling shares (Like 30%). Unknown to you, I have companies B, C, D and E where the shareholding is me my wife, kids and girlfriends. Through my influence, companies B, C, D and E are awarded contracts by A which are extremely skewed in their favour. In due course we all lose money in company A only that the money has been "lost" to my companies! I cry with you in the morning then go celebrate with my wife and kids in the afternoon!!! To make sure employees don't payuka payuka ovyo, I can threaten them, employ selectively, put employees on a bonus galore or a combination of sorts! Never count on making a good sale. Have the purchase price be so attractive that even a mediocre sale gives good returns.
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Rank: Elder Joined: 7/22/2009 Posts: 7,570
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target1360 wrote:MaichBlack wrote:Ericsson wrote:I mentioned in an earlier post in this topic the company will become a shell like uchumi;now the signs are starting to appear.Material suppliers haven't been paid. The 38% stake of tow rivers owned by AVIC/CATIC;no money changed hands.Centum converted the amount of money they owed the contractor in unpaid dues to equity to settle the matter. Contractor of Two Rivers Mall is CATIC whose parent company is AVIC. Centum also has no room to borrow;debt is at limits and also the high interest rates have curtailed further borrowing 38% stake gone?? Just like that. Don't be surprised if this was the plan all along or/and someone has some interest in AVIC/CATIC through some intricate Web of shareholding or AVIC/CATIC have yet another agreement with some obscure company to cede 50% of their 38% to them!! Welcome to Nairobbery!!! so Centrum only owns 62% of the project! And the project is not complete yet! By the time it is done it might end up like the payslip of a Kenyan policeman. The shareholders will be called to be told what they HAD and given a breakdown of where it all went! Never count on making a good sale. Have the purchase price be so attractive that even a mediocre sale gives good returns.
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Rank: User Joined: 1/20/2014 Posts: 3,528
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Their debt level is getting out of hand with no tangible/credible revenue sources in the offing. Sidelines it is!!!!! Let those who have the will make money here, not me!!! Formal education will make you a living. Self-education will make you a fortune - Jim Rohn.
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Rank: Veteran Joined: 4/16/2014 Posts: 1,420 Location: Bohemian Grove
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MaichBlack wrote:VituVingiSana wrote:mv_ufanisi wrote:target1360 wrote:VituVingiSana wrote:Why would James Mworia (& CK) have bought Centum shares in the 60s [or so he says] if he knew about the drama? Naikuni/Mbugua stayed away from KQ shares coz they knew about the rot.
Mworia has much more to lose with his investment in Centum at the 60-ish entry price. maybe we should ask where the money to buy at sh 60 came from,just maybe Likely came from the bonus pool. being a large shareholder and having board seats often means that you are likely to benefit from skewed company deals that other shareholders know nothing about. remember the CMC guy Peter Muthoka and Andy Forwarder's deal? Andy Forwarders supposedly overcharged CMC by 1.5 billion because Peter was part of the board and could direct contracts to his company. This is the kind of stuff ordinary shareholders never know about. Don't compare yourself with significant shareholders and insiders if you're not sure about the backroom board deals. Peter Muthoka had voting clout [20% or so shareholding] on the board. His 'loss' on his 20% was adequately covered by the shady deals. The guy with the most to lose in Centum is CK with 25-30% if anyone else does anything fishy. @vvs - You are very familiar with Merali deals. This is how these things work. I set up company A which is publicly traded in the NSE. I sell all of you shares but I retain controlling shares (Like 30%). Unknown to you, I have companies B, C, D and E where the shareholding is me my wife, kids and girlfriends. Through my influence, companies B, C, D and E are awarded contracts by A which are extremely skewed in their favour. In due course we all lose money in company A only that the money has been "lost" to my companies! I cry with you in the morning then go celebrate with my wife and kids in the afternoon!!! To make sure employees don't payuka payuka ovyo, I can threaten them, employ selectively, put employees on a bonus galore or a combination of sorts! Such deals are the norm in Kenya. Like Merali who build two real estate projects with cash from ECB then the loans were written off before it was sold.So in any investment do lots of due diligence to safeguard your cash.
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Rank: Veteran Joined: 6/23/2011 Posts: 1,740 Location: Nairobi
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Centum is a slaughter house, wait and see.
If you quit when it was at 65.00 you are good to go , congrats
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Rank: Chief Joined: 1/3/2007 Posts: 18,224 Location: Nairobi
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MaichBlack wrote:VituVingiSana wrote:mv_ufanisi wrote:target1360 wrote:VituVingiSana wrote:Why would James Mworia (& CK) have bought Centum shares in the 60s [or so he says] if he knew about the drama? Naikuni/Mbugua stayed away from KQ shares coz they knew about the rot.
Mworia has much more to lose with his investment in Centum at the 60-ish entry price. maybe we should ask where the money to buy at sh 60 came from,just maybe Likely came from the bonus pool. being a large shareholder and having board seats often means that you are likely to benefit from skewed company deals that other shareholders know nothing about. remember the CMC guy Peter Muthoka and Andy Forwarder's deal? Andy Forwarders supposedly overcharged CMC by 1.5 billion because Peter was part of the board and could direct contracts to his company. This is the kind of stuff ordinary shareholders never know about. Don't compare yourself with significant shareholders and insiders if you're not sure about the backroom board deals. Peter Muthoka had voting clout [20% or so shareholding] on the board. His 'loss' on his 20% was adequately covered by the shady deals. The guy with the most to lose in Centum is CK with 25-30% if anyone else does anything fishy. @vvs - You are very familiar with Merali deals. This is how these things work. I set up company A which is publicly traded in the NSE. I sell all of you shares but I retain controlling shares (Like 30%). Unknown to you, I have companies B, C, D and E where the shareholding is me my wife, kids and girlfriends. Through my influence, companies B, C, D and E are awarded contracts by A which are extremely skewed in their favour. In due course we all lose money in company A only that the money has been "lost" to my companies! I cry with you in the morning then go celebrate with my wife and kids in the afternoon!!! To make sure employees don't payuka payuka ovyo, I can threaten them, employ selectively, put employees on a bonus galore or a combination of sorts! Similar to what was done at Uchumi, eh? Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Veteran Joined: 6/23/2011 Posts: 1,740 Location: Nairobi
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Suposing you own a bar and you always drink in this bar of your
Supose you buy the beer at 300 bob like all the other patrons and that the actual cost of the beer is 100.
What cost do you inccurr of the beer you drink. Answer 100 bob
Why so. Beause at the end of the month you get back the profit meaning you even get refunded the 200 above the 100 bob actual cost
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Rank: Elder Joined: 6/2/2011 Posts: 4,818 Location: -1.2107, 36.8831
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VituVingiSana wrote:MaichBlack wrote:VituVingiSana wrote:mv_ufanisi wrote:
Likely came from the bonus pool.
being a large shareholder and having board seats often means that you are likely to benefit from skewed company deals that other shareholders know nothing about.
remember the CMC guy Peter Muthoka and Andy Forwarder's deal? Andy Forwarders supposedly overcharged CMC by 1.5 billion because Peter was part of the board and could direct contracts to his company.
This is the kind of stuff ordinary shareholders never know about. Don't compare yourself with significant shareholders and insiders if you're not sure about the backroom board deals.
Peter Muthoka had voting clout [20% or so shareholding] on the board. His 'loss' on his 20% was adequately covered by the shady deals. The guy with the most to lose in Centum is CK with 25-30% if anyone else does anything fishy. @vvs - You are very familiar with Merali deals. This is how these things work. I set up company A which is publicly traded in the NSE. I sell all of you shares but I retain controlling shares (Like 30%). Unknown to you, I have companies B, C, D and E where the shareholding is me my wife, kids and girlfriends. Through my influence, companies B, C, D and E are awarded contracts by A which are extremely skewed in their favour. In due course we all lose money in company A only that the money has been "lost" to my companies! I cry with you in the morning then go celebrate with my wife and kids in the afternoon!!! To make sure employees don't payuka payuka ovyo, I can threaten them, employ selectively, put employees on a bonus galore or a combination of sorts! Similar to what was done at Uchumi, eh? Exactly. Ciano and team were the CEO and managers yet they were also the main suppliers. Do you think they care when share price tanks? NO! Corporate Kenya is worse than GoK. Receive with simplicity everything that happens to you.” ― Rashi
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Rank: Elder Joined: 12/25/2014 Posts: 2,301 Location: kenya
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MaichBlack wrote:VituVingiSana wrote:mv_ufanisi wrote:target1360 wrote:VituVingiSana wrote:Why would James Mworia (& CK) have bought Centum shares in the 60s [or so he says] if he knew about the drama? Naikuni/Mbugua stayed away from KQ shares coz they knew about the rot.
Mworia has much more to lose with his investment in Centum at the 60-ish entry price. maybe we should ask where the money to buy at sh 60 came from,just maybe Likely came from the bonus pool. being a large shareholder and having board seats often means that you are likely to benefit from skewed company deals that other shareholders know nothing about. remember the CMC guy Peter Muthoka and Andy Forwarder's deal? Andy Forwarders supposedly overcharged CMC by 1.5 billion because Peter was part of the board and could direct contracts to his company. This is the kind of stuff ordinary shareholders never know about. Don't compare yourself with significant shareholders and insiders if you're not sure about the backroom board deals. Peter Muthoka had voting clout [20% or so shareholding] on the board. His 'loss' on his 20% was adequately covered by the shady deals. The guy with the most to lose in Centum is CK with 25-30% if anyone else does anything fishy. @vvs - You are very familiar with Merali deals. This is how these things work. I set up company A which is publicly traded in the NSE. I sell all of you shares but I retain controlling shares (Like 30%). Unknown to you, I have companies B, C, D and E where the shareholding is me my wife, kids and girlfriends. Through my influence, companies B, C, D and E are awarded contracts by A which are extremely skewed in their favour. In due course we all lose money in company A only that the money has been "lost" to my companies! I cry with you in the morning then go celebrate with my wife and kids in the afternoon!!! To make sure employees don't payuka payuka ovyo, I can threaten them, employ selectively, put employees on a bonus galore or a combination of sorts! @maichblack this is true. I have thought through what you have stated and it makes a lot sense. so the small companies offering contracts can get good returns than the share value that someone has.so his stake in that company is just for "face mask. sad sad
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Rank: Member Joined: 3/26/2012 Posts: 280
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This same guy who lost big in Uchumi bought the Uchumi Branch next to KPLC years back from UCHUMI at a reasonable price using board and leased back to UCHUMI at reasonable rent. We have to accept that even in school there were guys who were sharper than Ass. DOH
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Rank: Chief Joined: 1/3/2007 Posts: 18,224 Location: Nairobi
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dunkang wrote:VituVingiSana wrote:MaichBlack wrote:VituVingiSana wrote:mv_ufanisi wrote:
Likely came from the bonus pool.
being a large shareholder and having board seats often means that you are likely to benefit from skewed company deals that other shareholders know nothing about.
remember the CMC guy Peter Muthoka and Andy Forwarder's deal? Andy Forwarders supposedly overcharged CMC by 1.5 billion because Peter was part of the board and could direct contracts to his company.
This is the kind of stuff ordinary shareholders never know about. Don't compare yourself with significant shareholders and insiders if you're not sure about the backroom board deals.
Peter Muthoka had voting clout [20% or so shareholding] on the board. His 'loss' on his 20% was adequately covered by the shady deals. The guy with the most to lose in Centum is CK with 25-30% if anyone else does anything fishy. @vvs - You are very familiar with Merali deals. This is how these things work. I set up company A which is publicly traded in the NSE. I sell all of you shares but I retain controlling shares (Like 30%). Unknown to you, I have companies B, C, D and E where the shareholding is me my wife, kids and girlfriends. Through my influence, companies B, C, D and E are awarded contracts by A which are extremely skewed in their favour. In due course we all lose money in company A only that the money has been "lost" to my companies! I cry with you in the morning then go celebrate with my wife and kids in the afternoon!!! To make sure employees don't payuka payuka ovyo, I can threaten them, employ selectively, put employees on a bonus galore or a combination of sorts! Similar to what was done at Uchumi, eh? Exactly. Ciano and team were the CEO and managers yet they were also the main suppliers. Do you think they care when share price tanks? NO! Corporate Kenya is worse than GoK. No. The taxpayer doesn't lose his shirt for an investment he didn't make in a private concern. You invest in a private firm at your own risk. Through Warren Buffett's advice [as I have oft repeated here] do NOT invest in a firm, no matter how attractive it looks, if you do NOT trust the Board/Management. Period. Firms I do not invest in: Merali's firms - Never. Once I thought I should. Then I read the Annual Report re: Sameer Business Park. GoK controlled e.g NBK - except KenRe [& perhaps KCB in the future] Uchumi - I bailed out years ago at a huge profit. Went back in during the Rights. And walked out when I realized what a stupid mistake I had made. Olympia - My worst investment. KQ - I was badly burnt Kuruwitu - Never put in a penny. No plans to either! Home Afrika - I read the IM. Scam. Mumias - I bailed out years ago. Never looked back. And many others. Where am I invested? [Sigh, cash is depleted] Unga - Not coz of Ndegwas but Seaboard who seconded the MD. KenRe - Yes, I made an exception coz the MD seems a good guy but if he leaves... KenolKobil - Still hurting but Ohana is doing a-OK. Williamson - Solid, private management. Long-term thinking. I&M - 100% private. I watch it though. Aga Khan firms - Good management. I buy on dips. Looking at more TPSEA. Flame Tree - Just a few but I like it BUT I also watch it. I'd like to know whether the CEO (80% owner) has side deals as a supplier to FTGH. Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Elder Joined: 7/22/2009 Posts: 7,570
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dunkang wrote:VituVingiSana wrote:MaichBlack wrote:VituVingiSana wrote:mv_ufanisi wrote:
Likely came from the bonus pool.
being a large shareholder and having board seats often means that you are likely to benefit from skewed company deals that other shareholders know nothing about.
remember the CMC guy Peter Muthoka and Andy Forwarder's deal? Andy Forwarders supposedly overcharged CMC by 1.5 billion because Peter was part of the board and could direct contracts to his company.
This is the kind of stuff ordinary shareholders never know about. Don't compare yourself with significant shareholders and insiders if you're not sure about the backroom board deals.
Peter Muthoka had voting clout [20% or so shareholding] on the board. His 'loss' on his 20% was adequately covered by the shady deals. The guy with the most to lose in Centum is CK with 25-30% if anyone else does anything fishy. @vvs - You are very familiar with Merali deals. This is how these things work. I set up company A which is publicly traded in the NSE. I sell all of you shares but I retain controlling shares (Like 30%). Unknown to you, I have companies B, C, D and E where the shareholding is me my wife, kids and girlfriends. Through my influence, companies B, C, D and E are awarded contracts by A which are extremely skewed in their favour. In due course we all lose money in company A only that the money has been "lost" to my companies! I cry with you in the morning then go celebrate with my wife and kids in the afternoon!!! To make sure employees don't payuka payuka ovyo, I can threaten them, employ selectively, put employees on a bonus galore or a combination of sorts! Similar to what was done at Uchumi, eh? Exactly. Ciano and team were the CEO and managers yet they were also the main suppliers. Do you think they care when share price tanks? NO! Corporate Kenya is worse than GoK. This was round two. Round one was Dj! Never count on making a good sale. Have the purchase price be so attractive that even a mediocre sale gives good returns.
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Rank: Chief Joined: 1/3/2007 Posts: 18,224 Location: Nairobi
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MaichBlack wrote:dunkang wrote:VituVingiSana wrote:MaichBlack wrote:VituVingiSana wrote:mv_ufanisi wrote:
Likely came from the bonus pool.
being a large shareholder and having board seats often means that you are likely to benefit from skewed company deals that other shareholders know nothing about.
remember the CMC guy Peter Muthoka and Andy Forwarder's deal? Andy Forwarders supposedly overcharged CMC by 1.5 billion because Peter was part of the board and could direct contracts to his company.
This is the kind of stuff ordinary shareholders never know about. Don't compare yourself with significant shareholders and insiders if you're not sure about the backroom board deals.
Peter Muthoka had voting clout [20% or so shareholding] on the board. His 'loss' on his 20% was adequately covered by the shady deals. The guy with the most to lose in Centum is CK with 25-30% if anyone else does anything fishy. @vvs - You are very familiar with Merali deals. This is how these things work. I set up company A which is publicly traded in the NSE. I sell all of you shares but I retain controlling shares (Like 30%). Unknown to you, I have companies B, C, D and E where the shareholding is me my wife, kids and girlfriends. Through my influence, companies B, C, D and E are awarded contracts by A which are extremely skewed in their favour. In due course we all lose money in company A only that the money has been "lost" to my companies! I cry with you in the morning then go celebrate with my wife and kids in the afternoon!!! To make sure employees don't payuka payuka ovyo, I can threaten them, employ selectively, put employees on a bonus galore or a combination of sorts! Similar to what was done at Uchumi, eh? Exactly. Ciano and team were the CEO and managers yet they were also the main suppliers. Do you think they care when share price tanks? NO! Corporate Kenya is worse than GoK. This was round two. Round one wa Dj! DJ Ciano Now the folks at Jamii Bora via Kipngetich. Enjoy your ride. I am staying away. Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Elder Joined: 7/22/2009 Posts: 7,570
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VituVingiSana wrote:MaichBlack wrote:dunkang wrote:VituVingiSana wrote:MaichBlack wrote:VituVingiSana wrote:mv_ufanisi wrote:
Likely came from the bonus pool.
being a large shareholder and having board seats often means that you are likely to benefit from skewed company deals that other shareholders know nothing about.
remember the CMC guy Peter Muthoka and Andy Forwarder's deal? Andy Forwarders supposedly overcharged CMC by 1.5 billion because Peter was part of the board and could direct contracts to his company.
This is the kind of stuff ordinary shareholders never know about. Don't compare yourself with significant shareholders and insiders if you're not sure about the backroom board deals.
Peter Muthoka had voting clout [20% or so shareholding] on the board. His 'loss' on his 20% was adequately covered by the shady deals. The guy with the most to lose in Centum is CK with 25-30% if anyone else does anything fishy. @vvs - You are very familiar with Merali deals. This is how these things work. I set up company A which is publicly traded in the NSE. I sell all of you shares but I retain controlling shares (Like 30%). Unknown to you, I have companies B, C, D and E where the shareholding is me my wife, kids and girlfriends. Through my influence, companies B, C, D and E are awarded contracts by A which are extremely skewed in their favour. In due course we all lose money in company A only that the money has been "lost" to my companies! I cry with you in the morning then go celebrate with my wife and kids in the afternoon!!! To make sure employees don't payuka payuka ovyo, I can threaten them, employ selectively, put employees on a bonus galore or a combination of sorts! Similar to what was done at Uchumi, eh? Exactly. Ciano and team were the CEO and managers yet they were also the main suppliers. Do you think they care when share price tanks? NO! Corporate Kenya is worse than GoK. This was round two. Round one wa Dj! DJ Ciano Now the folks at Jamii Bora via Kipngetich. Enjoy your ride. I am staying away. Kipngetich has been a clean guy so far in his previous positions. Any skeletons? Never count on making a good sale. Have the purchase price be so attractive that even a mediocre sale gives good returns.
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Rank: Chief Joined: 1/3/2007 Posts: 18,224 Location: Nairobi
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@MaichBlack - The chaps of Jamii Bora are behind Kip. I am not so sure about them not Kip. Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Member Joined: 3/26/2012 Posts: 280
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Was in school with CEO of Jamii Bora and worked with Tim. Clean guys. Their ambition I think is to have a strong solid bank and also diversify their investment hence Uchumi. I think they saw the areas to make money was in Banking and retail sectors. DOH
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Rank: Elder Joined: 6/2/2011 Posts: 4,818 Location: -1.2107, 36.8831
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Bachuma Gate wrote:Was in school with CEO of Jamii Bora and worked with Tim. Clean guys. Their ambition I think is to have a strong solid bank and also diversify their investment hence Uchumi.
I think they saw the areas to make money was in Banking and retail sectors.
I can't use clean with a human being. May be say, they are not as crazy as DJ CK and the Cianos. Also, i think VVS was alluding to the owners not JBB employees. Like, Mworia is an employee at Centum, but DJ is the one who runs the show. Receive with simplicity everything that happens to you.” ― Rashi
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Rank: Member Joined: 1/15/2010 Posts: 625
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This bear seems to have pushed people to extreme pessimism and I'm one of them. Centum not too long ago was a darling on Wazua. They had great projects in the pipeline, spitting a good game with regards to their vision for the future and getting great deals. While the stock price was going up people were happy. And ofcourse the Business Daily correspondent based in Centum kept supplying a steady stream of good news on the counter. The bear seems to have hit Centum shareholders the worst, they were the most optimistic and to add insult to injury while shareholders lost value at the NSE, Centum was going crazy announcing how it's giving the biggest employee bonuses in the NSE. The truth though always seems to be in the middle of extreme optimism and extreme pessimism. Yes there's a stink coming from Centum because of the bonuses. The delay of the Two Rivers project shouldn't be a surprise for a project of its size. It's a little bit unclear whether there's some shady deals going on at Centum that skews returns for shareholders.
At the same time, Centum still remains quite a well diversified company with interests in multiple sectors. The fact that they held UAP at much less value on their books than what they eventually got (I think 2.2 billion versus 5 billion actual value) shows that they are being conservative and not trying to inflate asset values. They do have quite a number of talented guys at the company. James Mworia is a CFA charter holder (which means that he's smart and worked hard to earn that) and some of the employees are Tutu fellows, Alliance high school alumni etc. So you'd think that these are not the kind of people that would like to blow a career by taking a company down.
Their project execution has been quite exemplary - see Two Rivers from vision to execution and they have been quite bold with their projects. It's tough to find a team like that in Kenya and at a time when Africa is full of opportunities that would really be beneficial to a potential investor.
DJ CK is a looming presence on the company so you have to decide for yourself if he's likely to bring the company down and perhaps deal with another appearance at the courts a la Uchumi times. For the most part you have to check what his incentives are. Being such a large shareholder at Centum and staked his name on the company, he's more likely to benefit if the company valuation goes really north. Isn't his ambition to be a billionaire and appear on Forbes? Centum seems like the only vehicle that could achieve this for him.
Centum seems to have lost trust because of excessive executive compensation - they can redeem themselves by truly aligning employee and shareholder interests. For example, bonuses should at the very least not be paid on an annual basis but maybe in tranches of 5 years - that's anyways part of the 5 year planning tranches. That way employees focus on the long term. And atleast a large % of bonuses should be paid in company shares so employees and shareholders are in the same bus. Summary: Centum is not as good or as bad as people make it out to be due to ups and downs of the NSE.
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Rank: Elder Joined: 9/23/2009 Posts: 8,083 Location: Enk are Nyirobi
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mv_ufanisi wrote:This bear seems to have pushed people to extreme pessimism and I'm one of them. Centum not too long ago was a darling on Wazua. They had great projects in the pipeline, spitting a good game with regards to their vision for the future and getting great deals. While the stock price was going up people were happy. And ofcourse the Business Daily correspondent based in Centum kept supplying a steady stream of good news on the counter. The bear seems to have hit Centum shareholders the worst, they were the most optimistic and to add insult to injury while shareholders lost value at the NSE, Centum was going crazy announcing how it's giving the biggest employee bonuses in the NSE. The truth though always seems to be in the middle of extreme optimism and extreme pessimism. Yes there's a stink coming from Centum because of the bonuses. The delay of the Two Rivers project shouldn't be a surprise for a project of its size. It's a little bit unclear whether there's some shady deals going on at Centum that skews returns for shareholders.
At the same time, Centum still remains quite a well diversified company with interests in multiple sectors. The fact that they held UAP at much less value on their books than what they eventually got (I think 2.2 billion versus 5 billion actual value) shows that they are being conservative and not trying to inflate asset values. They do have quite a number of talented guys at the company. James Mworia is a CFA charter holder (which means that he's smart and worked hard to earn that) and some of the employees are Tutu fellows, Alliance high school alumni etc. So you'd think that these are not the kind of people that would like to blow a career by taking a company down.
Their project execution has been quite exemplary - see Two Rivers from vision to execution and they have been quite bold with their projects. It's tough to find a team like that in Kenya and at a time when Africa is full of opportunities that would really be beneficial to a potential investor.
DJ CK is a looming presence on the company so you have to decide for yourself if he's likely to bring the company down and perhaps deal with another appearance at the courts a la Uchumi times. For the most part you have to check what his incentives are. Being such a large shareholder at Centum and staked his name on the company, he's more likely to benefit if the company valuation goes really north. Isn't his ambition to be a billionaire and appear on Forbes? Centum seems like the only vehicle that could achieve this for him.
Centum seems to have lost trust because of excessive executive compensation - they can redeem themselves by truly aligning employee and shareholder interests. For example, bonuses should at the very least not be paid on an annual basis but maybe in tranches of 5 years - that's anyways part of the 5 year planning tranches. That way employees focus on the long term. And atleast a large % of bonuses should be paid in company shares so employees and shareholders are in the same bus. Summary: Centum is not as good or as bad as people make it out to be due to ups and downs of the NSE. Good writing till the conclusion where you have claimed that we are bashing Centum because we are suffering bear blues. You remind me of Dr Jason Ndaka Kaviti who meticulously examined Dr Ouko's fractures, gunshot wounds, extensive burns then reached the conclusion that the man had committed suicide. Life is short. Live passionately.
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Centum pays out KSH 1 billion to employees
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