Airtel doubles incentive shares to improve IPO participation
The IPO, which opened at the end of August is expected to close on Friday after a two-week extension. Photo / File
What you need to know:
- The offer comes just a few days before the IPO is expected to close this Friday
Airtel has doubled its incentive share offering in a bid to attract more participation in its initial public offering, which was on October 13, extended by another 15 days.
The offer comes just a few days before the IPO is expected to close this Friday.
In a statement yesterday, Airtel noted that the doubling of the share incentive offer sought to promote allocation of more shares to Ugandan investors.
Mr Manoj Murali, the Airtel managing director, said the company was keen to promote broad ownership “of our shares, noting that the “doubled incentive shares were available for all categories of investors to further enhance the attractiveness of our IPO”.
Airtel floated eight billion shares at a price offer of Shs100 at the end of August with the target of mobilising at least Shs800b. However, the telecom extended the offer a day to the closure.
“The IPO is coming to a close on October 27 … I call upon those who wish to make the last-minute applications, to do so. We have a strong team of partners on this transaction that will assist you to make an informed choice,” Mr Manoj said.
Airtel floated shares after a year of delay, citing market conditions.
However, the IPO came at a time when the market had been strained by the affect effects of Covid-19, which was later worsened by the Russia-Ukraine conflict.
Analysts have previously indicated that Airtel had extended the IPO to maximise share uptake, which had been lower that projected.
Airtel is the second telecom to list on the Uganda Securities Exchange in fulfilment of the law that requires all telecommunication companies to sell at least 20 percent of their stake to Ugandans. MTN completed the requirement in 2021, as part of a license condition.
Airtel yesterday indicated that retail investors applying for 2,500 shares, and up to 18.5m shares, will receive 10 incentive shares for every 100 shares allocated, which is an improvement from the five incentive shares for every 100 shares allocated earlier.
The offer will also apply to professional investors in different categories, while those that have already applied will receive the revised incentive shares as well.
