Prologue : Giants Fall in Slow Motion!
Centum is a train wreck waiting to happen!
Centum seems to be overvaluing its assets to be able to attract more debt than it can repay and is technically insolvent. It has assets whose real market value is approximately KES 16 billion (Adjusting for revaluations and loans to investees considered assets) and a debt which is KES 21 billion. Centum is thus insolvent to the tune of KES 5 billion. This insolvency is increasing by the day with the Kenya shilling depreciating against hard currencies since Centum holds 60% of its debt (KES 15.6 billion) in Dollar and Euro denominated loans. Furthermore, 88% of the assets held are illiquid (being in venture capital, private equity, and real estate) with what we can call questionable valuations. With the debts falling due and the asset values shrinking, Centum is facing a significant cash crunch soon if not already deep in it. It is already taking more debt to pay previous debt and interest in what is a typical sign of a ponzi scheme.
It’s CEO however is on a media publicity spree covering the poor performance not with data and clear strategies but with hype and incomprehensible justifications! The market is never consistently wrong as he claims. As he speaks in an echo chamber, the market seems to know where the truth lies.
This is a series of articles, nicknamed episodes, aimed to expose the misrepresentations, management greed and a clear lack of governance in Centum. Analysed using available data and facts as disclosed by the management and media interviews and publications approved by Centum.
The CEO, James Mworia, is focussed on creating personal wealth through Centum and in the process, he is inadvertently destroying shareholder value. He has managed a well-oiled PR machinery, financed by the shareholders funds, smear campaigns against whatsoever questions Centum’s performance and reports, firing (in the guise of voluntary resignations) staff, aligned and effectively managed the remaining management, board and main shareholders.
Due to the real fear of the resources and power that James Mworia wields this report is anonymous and filed as a whistle blower article. Centum will choose to ensure these notes are not analysed and will shift attention and focus on personal attacks instead of addressing the issues! Ad hominem responses to factual questions remain the main approach employed by Centum.
The information disclosed in the series is factual. Where opinion is given or matters were not confirmed, it has been clearly indicated. Time should be taken to confirm the matters raised and caution should be taken on information shared by management. Source documents should be utilised especially by parties with access to the same and any original documents.
“Don’t shoot the messenger”!