Two of Kenya’s oldest and most established tea producers, Williamson Tea Kenya PLC and Kapchorua Tea Kenya PLC, have announced plans to issue bonus shares to their shareholders after securing approval from the Capital Markets Authority (CMA).
The boards of both companies confirmed in a public statement that shareholders will receive bonus shares at a ratio of one bonus share for every existing share held. This move is expected to strengthen shareholder value while broadening the equity base of the companies at a time when the tea industry faces both local and global challenges.
According to the notice, the bonus issue applies to all individuals listed as shareholders in the respective company’s records as of the close of business on Monday, 13 October 2025. The companies further disclosed that their registers will be closed from Tuesday, 14 October 2025 to Friday, 17 October 2025 to facilitate the issuance of the bonus shares.
The allocation of one bonus share for every share held is among the most generous corporate actions in the Nairobi Securities Exchange (NSE) in recent years, underscoring the financial resilience of both companies despite a volatile operating environment.
Founded more than a century ago, Williamson Tea Kenya and Kapchorua Tea Kenya have built their reputations as major players in Kenya’s tea sector, a key driver of foreign exchange earnings for the country. By distributing bonus shares, the companies are sending a strong signal of their confidence in long-term growth.
The move comes at a time when the Nairobi Securities Exchange is looking to attract more retail and institutional investors amid subdued trading volumes.
A bonus share issue increases the number of outstanding shares without changing the overall market value of the company. Although it does not provide shareholders with immediate cash returns, it dilutes the share price, often making the stock more affordable and attractive to new investors.
For example, an investor holding 1,000 shares of Williamson Tea Kenya will automatically receive an additional 1,000 shares once the bonus is issued. This not only doubles the shareholding but also positions the investor for higher dividends in the future, should the companies declare them.
Such a move can also enhance liquidity in the secondary market, as more shares become available for trading.
Kenya is the world’s largest exporter of black tea, with the sector contributing significantly to the economy through export earnings and job creation. However, the industry has faced pressures from fluctuating global prices, climate change, and rising production costs.
Despite these headwinds, Williamson Tea Kenya and Kapchorua Tea Kenya have continued to report strong fundamentals, supported by strategic cost management and diversified tea products. By issuing bonus shares, the companies are signaling optimism about their financial health and the sector’s long-term prospects.
The announcement is likely to draw increased investor interest on the NSE. In previous instances, bonus share announcements have triggered rallies in share prices as traders anticipate higher future valuations.
With the issuance of bonus shares, Williamson Tea Kenya and Kapchorua Tea Kenya are reinforcing their reputations as companies committed to rewarding shareholder loyalty. The timing also positions them strategically in an evolving financial landscape where investor confidence remains critical.
For shareholders, the announcement marks an opportunity to expand their holdings at no extra cost, while for the broader capital market, it demonstrates how established firms can use corporate actions to strengthen market activity.
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