MTN Uganda is set to sell a fifth of its stake to Kenyan and other East African investors when it floats its initial public offer (IPO) Uganda Securities Exchange (USE)
This follows the requisite approval by the Capital Markets Authority and Uganda Securities Exchange for MTN Group to sell 20% of its shareholding in MTN Uganda to the public. MTN Group owns 96% of MTN Uganda.
The listing is in line with the Group’s strategic priority to create shared value, partly through ensuring broad-based ownership in its operating subsidiaries. It is also in line with the provisions of MTN Uganda’s NTO licence, which require its listing by the end of June 2022.
MTN Group Vice President for Southern and East Africa Yolanda Cuba called the planned listing a milestone saying over the last 23 years, the people of Uganda have embraced MTN as their own and given them the legitimacy to operate throughout this country. He further added they are reciprocating by inviting Ugandans to share in the ownership of the success that they have built together.
Over the years, MTN Uganda has prioritised the expansion of rural coverage. The telecommunication company Currently covers 97% of the country’s population and have over 6,000km of fibre connectivity to provide the voice and data bandwidth that connects more than 15 million subscribers not only within the country but also across the world.
The IPO is expected to boost the number of retail investors at the Uganda Securities Exchange from about 40,000 to 200,000 investors and make the telecommunication company the second publicly traded telecom in EAC after Safaricom’s IPO on the Nairobi Securities Exchange in 2008.
“This will potentially be the largest IPO on the Ugandan market and will be delivered primarily through a digital paperless/ green platform which is the first of its kind in East Africa,” MTN Uganda in a statement.
MTN Group Ltd of South Africa owns more than 90 per cent of the company’s shares, while a Ugandan businessman holds less than 5 per cent shares.
MTN Uganda, which has 15 million subscribers, had its operating licence renewed for 12 years in February last year after paying $100 million (Kes11 billion) with the local listing requirement as a precondition for the permit nod.
“We are delighted to witness the honouring of this commitment by MTN,” said Irene Kaggwa-Sewankambo, the Executive Director of the Uganda Communications Commission.
MTN Uganda was granted two years starting July 1 2020, to list 20 per cent of its equity on the Ugandan Securities Exchange.