Giant telecommunication company, Airtel Uganda has confirmed its intention to list on the stock market of Uganda up to 20 percent of its shares, totaling Shs8 billion.
The company, wholly owned by Airtel Africa plc, is due to publish the prospectus (offer document) approved by the Capital Markets Authority, which will pave the way for the Initial Public Offer (IPO).
This is in line with the terms and conditions of the National Telecommunications Operator’s (NTO) license that was issued to Airtel in 2020, following new licensing guidelines by the Uganda Communications Commission (UCC).
Nishant Mohan, the Airtel Finance Director said the Initial Public Offer, which should be operational by the 16th of December this year, will give Ugandans preferential treatment.
In 2020, following a recommendation by Cabinet, UCC issued new guidelines for the National Telecommunications Operators license under the Uganda Communications (Licensing) Regulations 2019 and later the Uganda Communications (Fees and Fines) (Amendment) Regulations 2020.
They provided for, among others, the sale of at least 20 percent of the company to the public, as part of the governance and national economic contribution function.
It becomes the second company to go public under the new regulations and guidelines, having delayed beyond the 60-day deadline for a company to list after obtaining the NTO license.
Airtel Uganda Managing Director, Majoj Murali, limited on how much information they can give to the public because of the capital markets regulations, said they are confident of the market.
The first IPO by an NTO was MTN Uganda’s 22.5 billion shares in December 2021, and while it termed the exercise successful, there was a 36 percent undersubscription.
This was attributed to a partly negative campaign on social media that dampened the willingness, especially by the Ugandans to buy the shares.
Airtel Board Chairman Hannington Karuhanga urged Ugandans especially the youth to diversify their savings into equity, instead of leaving the market to foreign investors, which will also contribute more to the development of the economy.