Shares in MTN’s Uganda business started trading on that country’s stock exchange on Monday, following an initial public offer (IPO) that raised R2.4bn, the largest in the East African country’s history.
This completes another piece of the mobile operator’s ongoing strategy to increase local ownership in its operating companies and meet its licence obligations.
MTN Uganda said it had received the necessary approvals for an IPO on the Uganda Securities Exchange (USE) from the country’s Capital Markets Authority (CMA) and the USE.
The listing is the largest IPO in Uganda’s history but only met two-thirds of its target. In a statement last week, MTN Uganda didn’t give reasons why it wasn’t able to allot the full 4.5-billion shares offered.
The listing reduces MTN Group’s stake in the Uganda unit from 96% to about 83%. The company is now the largest on the USE.
“Today marks the conclusion of a remarkable journey which has given over 20,000 Ugandans the opportunity to become owners of MTN Uganda,” said MTN Uganda CEO Wim Vanhelleputte.
“We are particularly proud of our digital m-IPO collaboration with the USE, an African first. More than 93% of the applications were made via the m-IPO platform, with the majority of these investors new market participants,” he said.
The unit becomes the latest of MTN’s Africa businesses to list on a local exchange. Most recently, in May, MTN Rwanda listed on that country’s exchange, becoming the first telecommunication operator to do so there. MTN Nigeria listed in May 2019, while its Ghana business had its stock flotation the previous year.
Last week, MTN began the process to sell a portion of its Nigerian unit to local investors — which received the thumbs up from the West African country’s capital markets watchdog — moving it one step closer to closing a deal that could net it nearly R4bn.
MTN shares, which have more than doubled so far this year, up 166%, were down 3.81% to R160.45 on Monday, in line with competitors Vodacom and Telkom, which fell 1.72% and 3.65%, respectively. The group is currently valued at R302.3bn.
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.