It was clear that Airtel Uganda’s initial public offering was struggling. The company extended the flotation’s closing date by two weeks, never explaining why, although bankers at the IPO’s lead underwriter said it was due to low investor turnout. The bankers turned out to be right – which is not surprising given how the larger MTN Uganda listing went in 2021.
The company said Monday that the IPO achieved a subscription rate of 54.45 per cent, including bonus shares, representing a total of Shs211.4bn ($56mn) worth of shares sold in the flotation.
In total, Airtel sold 4,355,902,835 shares in the IPO, representing 54.45 per cent of the total IPO shares, to 4,614 applicants. However, these shares were sold both directly and through incentives; in short, the incentive shares massage the true outcome of the IPO.
The company said that professional investors will hold 10.55 per cent of the company’s total stock, while retail investors own just 0.34 per cent of Airtel Uganda’s outstanding shares. The professional investor(s) Airtel is referring to is the National Social Security Fund, the state pension fund, which announced on the last day of the IPO that it had bought a 10.55 per cent stake in the company.
Read more: NSSF buys 10.55% stake in Airtel as part of IPO
MTN Uganda’s IPO, on the other hand, achieved a 60 per cent subscription rate and raised Shs536bn out of an expected Shs900bn.
Airtel will start trading on the Uganda Securities Exchange on Tuesday 7 November.
($1 = Shs3,775.56)
