Housing Finance Bank to list shares at secrities exchange
Posted Thursday, November 17 2011 at 00:00
Investors will soon own a piece of Housing Finance Bank after the firm’s board approved a proposal to sell shares through an Initial Public Offer (IPO).
Mr Nicholas Okwir, the bank’s managing director, told Daily Monitor on phone yesterday that the firm now awaits approval of shareholders but noted that an IPO would be issued next year.
Housing Finance Bank (HFB) is a commercial bank owned by the National Social Security Fund which has 50 per cent stake in the venture, the government through the Ministry of Finance (49.2 per cent) and National Housing and Construction Company (0.8 per cent).
Mr Okwir said the desire to list on the local bourse seeks to enable the firm go public and get more public participation and involvement in the management of the company.
He, however, declined to go into specifics of the number of shares that will be offered to the public, the equivalent value, the cost per share and the exact date for the IPO, saying that information will be availed early next year.
“We will go public next year but we will provide more details regarding when we will list and how many shares will be provided in 2012,” Mr Okwir said.
Mr Joseph Kitamirike, the Uganda Securities Exchange executive director, said it is a good development to see that more Ugandan born companies are picking interest in listing as this is expected to boost activity at the local bourse.
“We are pleased to have another local company pick interest in listing. I anticipate that the bank’s IPO will generate local and international interest,” Mr Kitamirike said. Housing Finance will, however, be required to apply to the Capital Markets Authority and USE upon approval by its shareholders.
If it floats shares, Housing Finance would become the sixth commercial bank to float shares on USE and the 15th firm to list on the local bourse. Other banks that are listed include Bank of Baroda, Dfcu, Stanbic, Equity and KCB.
Umeme’s managing director, Mr Charles Chapman was also recently quoted in the media saying that Uganda’s electricity distributor plans to sell shares to the public through an IPO on the USE and Nairobi Stock Exchange by March next year.
Subject to approval
This was, however, subject to approvals from Actis, a UK-based private equity fund that owns the power distributor. The increasing numbers of companies listing on the exchange is expected to offer the domestic investing public more alternatives for investment on the local bourse.
Listing of new companies is also expected to increase liquidity at the bourse. Mr Kenneth Kitariko, the chief executive officer of African Alliance, said the move will be a positive one to both USE and the bank. “HFB has mentioned this listing previously but we hope this time it will pass.”