Airtel Uganda has announced that it has doubled the amount of bonus shares offered to prospective investors in order to encourage more participation in its initial public offering (IPO), which is scheduled to conclude on Friday.
IPO means that it is the first time a company’s stock is offered to the public for purchase on a stock exchange. This allows the company to raise capital from investors by selling shares of ownership in the company. It is a significant financial event for a company and often attracts a lot of attention from investors and the public.
Airtel launched its share sale on 29th August and set the share price at 100 Ugandan shillings per share.
Initially, it had announced bonus shares of various sizes ranging from 1-37 for different categories of investors.
As the Friday deadline of buying shares looms, the company has announced that bonus offers will be doubled for investors across all categories.
“In order to encourage participation in the IPO and promote allocation to Ugandan investors, the Board of Directors has proposed a substantial enhancement of the incentive structure (doubling bonus shares),” reads the Airtel statement in part.
Retail investors applying for between 2 500 shares, and up to 18.5 million shares through the m-IPO platform (using Airtel Money) and were initially entitled to an additional 1 incentive share for every 100 sale shares allocated, in addition to the 5 incentive shares indicated above, will now get an additional 1 incentive shares for every 100 sale shares allocated, in addition to the 10 incentive shares indicated above.
Retail investors applying for more than 18.5 million shares and up to 37 million shares will not be entitled to 20 Incentive Shares for every 100 Sale Shares allocated instead of the earlier 10 Incentive Shares for every 100 Sale Shares allocated. Retail Investors applying for more than 37 million shares, will now get 40 Incentive Shares for every 100 Sale Shares allocated instead of the earlier proposed 20 Incentive Shares for every 100 Sale Shares allocated.
Professional Investors who apply for more than 40 million shares, but not more than 200 million shares, will now get 20 Incentive Shares for every 100 Sale Shares allocated instead of the earlier proposed 10 Incentive Shares for every 100 Sale Shares allocated. Those applying for more than 200 million shares, but not more than 400 million shares will now get 30 incentive shares for every 100 shares allocated post-IPO, instead of the original 15. Those applying for more than 400 million shares, but not more than 1,850 million will get 80 incentive shares for every 100 shares allocated post the IPO sale, inured of the earlier 20 incentive shares.
Professional investors, who apply for more than 1,850 million shares will get 112 incentive shares per 100 allocated post-IPO, instead of the earlier 37.5 incentive shares.
Commenting on the revision of the incentive share structure, Manoj Murali, the Managing Director Airtel Uganda said, “the Company is keen to promote broad ownership of our shares and welcomes the participation of all investors. We are excited about our growth trajectory and have, at minimum, doubled the incentive shares available for all categories of investors to further enhance the attractiveness of our IPO. The Airtel Uganda IPO is a landmark event in the country’s capital markets and we have left no stone unturned to ensure a successful outcome.”
The company announced that all investors who have previously applied for shares will receive the revised Incentive shares as well.
Investors allocated shares in the Offer will be eligible for dividends declared by the Company in November of 2023.
Manoj called on Ugandans to make the last-minute applications and take advantage of the offer.
“The IPO is coming to a close on 27th October, and we are truly humbled by the support that Ugandans have shown us. 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,” he said.
Airtel is selling 20% of its equity in a move aimed at raising 800 billion Ugandan shillings
Results of the IPO are expected on 6th November, and the shares will become available for trading on the Uganda Securities Exchange on 7th November 2023.
Once the listing is finalized, Airtel Uganda will become the second telecom company to be listed on Uganda’s stock exchange, following MTN Uganda.