The government of Mauritius is seeking to sell a 23.9 per cent stake in Kenya’s British-American Investments Company (Britam), formerly held by disgraced tycoon Dawood Rawat, to compensate investors who lost cash in an alleged Ponzi scheme back home.
The Indian Ocean island government seized the tycoon’s assets after accusing him of running a Ponzi scheme through a Mauritian insurer in a move that made Britam’s stock price dip by almost a quarter.
Mauritius Finance and Economic Development minister Seetanah Lutchmeenaraidoo told Parliament this week that the government was keen on securing a single buyer for the whole lot. According to a transcript of proceedings seen by Reuters, the minister is alleged to have said to the House: “If there is a buyer for Britam at 4.5 billion rupees (Sh13 billion), the government would gladly sell the shares.”
This could be a vote of confidence to investors who lost money in the scheme following reports that firms owned by Rawat had been placed in receivership by the Mauritian government over the alleged financial impropriety.
Rawat joined Britam’s board in 2013 and became the largest investor with an 18 per cent stake worth Sh5.8 billion. His nephew, Moussa Rawat, who was appointed director of Britam in August 2013 and Tarun Ghulati, an executive of one of the Rawats’ business units, had earlier joined the board in May 2013.
Rawat eventually increased shareholding which is estimated at 23.9 per cent which amounts to about 463 million shares out of the Britam’s 1.9 billion shares. Britam’s shares are currently trading hovering around Sh17 at the Nairobi Securities Exchange, with a high of Sh40 and a low of Sh14 in the last 12 months.
State Insurance Company of Mauritius is currently holding the 23.9 per cent stake belonging to he businessman. The minister said the takeover of Rawat’s shares was geared towards enhancing the firm’s value following the scam report to secure the interests of the local and international shareholders.