As Kenya’s business landscape rapidly evolves, family-owned enterprises face a pivotal choice: adapt to new market realities or risk losing relevance. With increasing competition and the need for long-term sustainability, experts are urging these businesses to consider an often-overlooked strategy—listing on the Nairobi Securities Exchange (NSE).
Why Family Businesses Should Consider Going Public
Frank Mwiti, CEO of the Nairobi Securities Exchange, is a strong advocate for this approach, emphasizing that listing on the NSE can safeguard a company’s legacy while ensuring sustained growth.
“Listing on the NSE ensures that a business outlives its founders by introducing new leadership and strengthening ownership structures,” Mwiti explained.
He argues that public listing provides businesses with access to capital, improved governance, and greater transparency, all of which contribute to long-term stability.
Yet, despite these advantages, many family-owned businesses remain hesitant to take the leap. The fear of losing control, dealing with stringent regulatory requirements, and altering traditional ways of doing business keeps them from exploring the public markets.
Unlocking Value Through Public Listing
Mwiti sees this reluctance as a missed opportunity. He highlights that when market conditions are favorable, listing allows business owners to unlock the true value of their shareholding, paving the way for expansion and long-term financial health.
“When the market is on an upward trend, listing enables owners to realize the full potential of their company’s value,” he noted.
Shri Krishana Overseas Ltd: Pioneering a New Path
One company embracing this shift is Shri Krishana Overseas Ltd (SKL), a leading packaging solutions provider. In a landmark move, SKL has announced plans to list by introduction on the NSE’s Small and Medium Enterprises (SME) Market Segment in July 2024.
This decision not only positions SKL as the first packaging firm to list on the NSE but also marks the first new listing on the exchange since 2020.
SKL’s Managing Director and Founder, Sonvir Singh, believes that going public is a strategic move that will accelerate the company’s expansion plans.
“Listing on the NSE’s SME Market Segment will provide Shri Krishana Overseas with access to capital markets, enabling us to raise funds and scale our operations,” Singh explained.
With rising demand for sustainable packaging in floriculture, horticulture, and pharmaceuticals, SKL aims to leverage this opportunity to expand its market reach and production capacity.
The Path Forward for Family Businesses
For family-owned businesses looking to scale, the path to public listing may seem daunting, but industry leaders like Mwiti and Singh demonstrate that the rewards far outweigh the risks. By embracing the NSE, these businesses can secure long-term financial health, enhance governance, and ensure that their legacy thrives for generations to come.
As Kenya continues to modernize its business environment, family enterprises that take the bold step of listing will be best positioned to capitalize on new growth opportunities and navigate the challenges of an evolving economy.
