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The Nairobi Securities Exchange (NSE) has indefinitely suspended trading of TransCentury Limited (TCL) and its subsidiary East African Cables PLC, effective June 20, 2025, following their placement under receivership and administration, respectively.

This move, announced by the Capital Markets Authority (CMA), aims to shield investors amid financial distress.

However, with new court orders and ongoing restructuring efforts, is an indefinite suspension justified, or could it hinder recovery? Let’s unpack the latest developments to explore the implications.

Why Were TransCentury and East African Cables Suspended?

The suspension was triggered by Equity Bank’s appointment of PricewaterhouseCoopers (PwC) receivers George Weru and Muniu Thoithi to manage TransCentury’s receivership and East African Cables’ administration over unpaid debts exceeding KSh 7 billion.

The CMA, prioritising investor protection, halted trading to curb market volatility, as confirmed in their June 20, 2025, statement.

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TransCentury’s Financial Woes

TransCentury, an infrastructure investment firm, has struggled with debt for years. Despite a 2024 net profit, the first since 2013,and a 187% year-to-date share price gain, the company owes Equity Bank over KSh 2.8 billion. Failed rights issues and refinancing challenges led to legal disputes since June 2023.

East African Cables’ Debt Crisis

East African Cables, a cable manufacturer, reported a 2% revenue rise to KSh 2.57 billion in 2024 but faces a KSh 2.2 billion debt to Equity Bank.

Asset sales and divestitures have been attempted, yet financial strain persists. A court order in March 2025 briefly paused creditor actions, but its lapse paved the way for receivership.

Latest Developments: Court Orders and Restructuring

On June 23, 2025, the High Court of Kenya issued orders restraining Equity Bank from selling or transferring TransCentury and East African Cables’ assets for 28 days, pending a hearing on July 22, 2025.

This follows a similar 14-day injunction on June 10, 2025, extended to protect the companies’ interests.

TransCentury’s board is actively pursuing restructuring, including a potential deal with Kuramo Capital to inject funds and settle debts, as noted in court filings.

The Case for the Trading Suspension

The CMA’s suspension aligns with investor protection goals. Here’s why it’s justified:

1. Preventing Market Chaos: Receivership news could spark panic selling, crashing share prices and destabilising the NSE.
2. Ensuring Fairness: A trading halt prevents exploitation of insider information during the receivership process.
3. Time for Receivers: PwC needs time to evaluate assets and debts without market pressure, especially with court-ordered asset protection in place.

The Case Against the Indefinite Suspension

Despite its intent, an indefinite suspension raises concerns, particularly with recent positive signals:

1. Turnaround Momentum: TransCentury’s 2024 profit and share price surge, alongside East African Cables’ revenue growth, suggest recovery potential. A prolonged halt could erode investor trust.
2. Delisting Risk: The High Court warned that delisting could be a “death knell,” leading to layoffs and asset liquidations. This could dent the NSE’s KSh 2.3 trillion market credibility.
3. Shareholder Lockout: Investors are unable to trade, trapping capital indefinitely. Clear timelines from the CMA could mitigate this.
4. Court’s Caution: The court’s June 2025 orders emphasise receivership as a last resort, urging preservation of the companies. A trading halt might amplify collapse fears, deterring financiers.

Should Trading Remain Suspended?

Balancing investor safety with market confidence is critical. Key considerations include:

• Court-Driven Pause: The 28-day asset protection order provides breathing room for restructuring. The CMA could align the suspension with this timeline, reviewing it post-July 22, 2025.
• Transparency Needs: Regular updates from the NSE and CMA on receivership progress would reduce uncertainty and bolster trust.
• Restructuring Viability: TransCentury’s Kuramo Capital talks and East African Cables’ asset sales could stabilise finances. If viable, resuming trading could support recovery.
• NSE’s Reputation: As East Africa’s largest exchange, the NSE must avoid delisting major firms to maintain investor confidence.

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What’s Next for TransCentury and East African Cables?

The receivership outcome hangs on several factors:

• Court Ruling: The July 22, 2025, hearing could extend asset protection or allow creditor actions, impacting the suspension.
• Restructuring Success: Kuramo Capital’s potential investment in TransCentury and East African Cables’ restructurings could settle debts, enabling trading to resume.
• Liquidation Risk: If restructuring fails, liquidation and delisting loom, with severe consequences for shareholders.
• Legal Delays: Ongoing disputes with Equity Bank may prolong uncertainty, extending the suspension.

A Time-Bound Approach

The NSE’s suspension of TransCentury and East African Cables protects investors amid receivership but risks crippling recovery if indefinite.

With court orders shielding assets until July 2025 and restructuring efforts underway, the CMA should consider a time-bound suspension, aligned with legal timelines, and provide regular updates.

This approach could preserve investor confidence, support recovery, and protect the NSE’s standing. Investors should monitor official NSE and CMA announcements for clarity.

Ronnie Paul is a seasoned writer and analyst with a prolific portfolio of over 1,000 published articles, specialising in fintech, cryptocurrency, and digital finance at Africa Digest News.