The Somen Brothers Looking For Way Out of AccessKenya’s Sinking Ship [Rumour]
AccessKenya reported a loss of Ksh 7.95 Million recently. There were reports last year from various market analysts and former advisors to the Somen brothers that they wanted to jump the sinking ship which is AccessKenya. The company seems to be in the red. Just before the AGM last year, there were boardroom wars at the former largest ISP. Now the company is a pale shadow of its past. There was massive and very abrupt layoff not long ago which affected even some very senior managers.
The MD of the company, Mr Kris Senanu, was quoted by Citizen Tv saying that they are going for the niche market. But the AccessKenya ship seems to be sinking faster than anyone can think of. In the financial release, the company stated that its IT revenues declined from Sh445 million to Sh152 million. But clients seems to have increased with corporate clients moving from 3,100 to 3,900 while residential clients grew from 3,000 to 4,500.
In March 2010, the company was said to be having boardroom fights which saw the exit of Eddy Njoroge , Ngugi Kiuna and Mungai Ngaruiya from the board. This was followed by the removal of Michael Somen who is the father to David and Jonathan from the chairmanship of the board. He was replaced by Mr Daniel Ndonye. The Somen family owns 26% of AccessKenya.
In March 2010, the company reported a pre-tax profit of over 182 Million. The share traded between Ksh 15 and 22 the whole of last year but now the share price is almost going below Ksh 7.35 which it closed at on Tuesday after droping more than 6% in value. The funny bit is that the management of AccessKenya believes that it will be saved by the rich. What they don’t know is that internet has been in Kenya for sometime and the segment of the market they are targeting might not have waited till now to get connection. They already have and the sector which is unexploited is the middle class segment.
I wish that AccessKenya would target Siwaka, Imara Daima, Buru Buru, Ngumo, jamhuri, Kasarani, Kahawa Wendani in a massive home internet drive. That might change the fortunes of the company but not Muthaiga, Runda, Sponsoring Golf and setting shop at WestGate
In November 2010, the company declared high number of hits on its website. The hits came to 13.5 Million to be exact. The Access@Home portal is said to have not broken even yet and even the consultants who were working on the portal were shown the door sometime last year in very unclear circumstances. In February, the company declared that it managed 99.9% uptime on its website and even launching an experimental store at WestGate early this month.
These great moves are not working for AccessKenya and the rumours which surfaced last year are back. David and Jonathan might be thinking of selling their stake in AccessKenya. They have secretly been looking for buyers through connections in Europe and North America but have not got good offers. I asked Jonathan last year if he really wanted to sell his stake and if his brother also wanted to sell out. Jonathan told me that he was not thinking of that and he then thought that AccessKenya was facing challenges yes but the company would overcome the challenges.
Do you think the Somen’s should leave Access Kenya?