Umeme suspends trading as Actis sells 14.3pc stake

What you need to know:

Actis had previously sold off a 45.1 per cent stake in the power firm in June 2014, scaling down from 60 per cent.

Umeme shares will stop trading as British private equity (PE) fund Actis sells off its remaining 14.3 per cent stake in the Ugandan power firm by next Tuesday.

Actis, which holds the stake in Umeme through subsidiary Umeme Holdings Ltd, had previously sold off a 45.1 per cent stake in the power firm in June 2014, scaling down from 60 per cent.

The remaining stake will be sold to investors through private placement. As a result the firm has applied to the Uganda Stock Exchange (USE) to have trading in its shares in the open market suspended until November 15, saying the sale might affect the company’s share price.

The cross-listed shares at the Nairobi Securities Exchange (NSE) are also suspended from trading for the period.

“Umeme has received notification from one of its major shareholders, Umeme Holdings Ltd, a subsidiary of Actis Infrastructure 2 LP, which owns 14.3 per cent of the issued shares of Umeme, that it wishes to sell the shares it owns to selected investors by way of private placement,” said Umeme in a statement Tuesday.

“Up to 232,214,516 ordinary shares will be offered in total.”

Umeme share is trading at Sh15.75 at the NSE, having shed 30 per cent in the year-to-date.

READ: Actis to sell stake in Uganda power vendor Umeme

The company has listed 1.62 billion shares on the Nairobi bourse, giving it a market capitalisation of Sh25.6 billion. When selling the 45.1 per cent stake in June 2014, Actis had committed to hold on to the balance of about 14 per cent for at least two years.

The commitment period lapsed four months ago.

Actis, the principal developer of the Garden City mall on Thika Road, has been actively raising funds for new investments in the region, including Sh50.5 billion ($500 million) for real estate investment in June.

In September 2015, the PE firm sold its 30 per cent stake in Globeleq Africa — the energy company that owns the 75 MW Mombasa-based thermal power plant Tsavo Power ( Kipevu II) — to CDC and Norwegian development financier Norfund for $227 million (Sh23 billion).