Taking up their rights is not unfair. Totally within their right to take up the rights and participate in the pro-rata allocation of the untaken rights.

There is no need for them however to take an extra allocation, knowing that the offer will be oversubscribed.

What is unfair is the fact that the Ndegwas will draw their rights cheque AFTER the determination of the subscription levels and the Board has an unfair advantage of determining the allocation criteria.

For instance if i have 1,000 shares i get 250 rights. I decide to take up the rights and apply for an extra 250 shares. My payment accompanies the application and i have to wait for the allocations.

Ndegwas take up their rights and apply for 10 times their entitlement (just an example). They provide a bank guarantee. They determine the allocation criteria, get themselves a pro-rata allocation based on their large application!

If i was CBK i would not allow them to exceed 25% while Wanjikus are allocated shares in batches of 10s and 20s. The fairest system would be to give people who apply for less than say 2,000 additional shares a full allocation and pro-rata thereafter.

BTW, read the IM, they do not even need a Bank Guarantee! All they need is a Letter of Undertaking which is 'free' (no fees unlike a Bank Guarantee) for QIIs & ICEA is considered a QII. As you said, what stops them from applying for Additional Shares after all the other applications are in & their form is backdated

when Guru speaks we listen

Two reasons why we will discuss it:

1. Its a listed company so all shareholders should have a say or at least bit** if things aren't right in their eyes.
2. Its a bank and therefore a PIE, public interest entity and the reason why the CBK guidelines apply to the Ndegwas.

I have no problem as long as the allocation criteria will be 'fair' to the minorities before they engage in their little adventure of exceeding 25%.

The 2007 Rights Issue was oversubscribed yet miraculously the ndegwas went from 25% to 28% thanks to an 'never seen before' allocation policy. The allocation policy - which was announced AFTER the allocation was a fait accompli - was rigged in favor of the ndegwas.

There can be an oversubscription without without all rights being taken up!

This arrives as a result of some shareholders neither selling or taking up the rights...

For example DTB rights issue was 86% oversubscirbed but 25% of the rights were not taken up... This resulted in the guys who applied for addtional shares getting the remaining 25% on a pro rata basis

yes and make a kill to pay for the next rights issue

Ndegwas will start selling immediately. Locks in their profits. Makes sure the 10% is old within 1 year. Plans the next Rights Issue.

Those who are supporting what the Ndegwa's are doing, i have no wonders for you, it is pure and straingt conmanship. Why cant they wait for the apllications and allotment process and get the outcome and if need be call for a special AGM to amended the process for more allocations the way CIC did after their last rights.

u can call it conmanship bt that is how pple mk money in th stock market n that is why it is th stock market. Look at a situation wea th stock market ws effecient n there were no imperfections in th economy, a share price wld hardly fluctuate, there wld b NO motivation 2 invest in th stock exchange!!!