Markets & Finance

Regulator plans wooing firms to NSE after long listing drought


CMA chief executive Paul Muthaura. PHOTO | FILE

The regulator is moving to address the IPO drought at the Nairobi Securities Exchange (NSE) through a campaign aimed at prospective firms.

Capital Markets Authority (CMA) chief executive Paul Muthaura said that a business incubator and accelerator forum will be held in early March to provide interested companies with a “realistic and practical” feel of the listing process.

“Interested firms will have an opportunity to participate in a stage-by-stage, one-on-one, structured engagement with the CMA, NSE, Nominated Advisors (NOMADS), transaction advisors, lawyers, auditors, stockbrokers and investment banks, among other service providers, to allow for confidential B2B discussions on their readiness for listing,’’ he said.

There have only been two low-key IPOs at the bourse in the past five years: the self-listing of the NSE Ltd in 2014 and the Stanlib I-Reit offering last year.

READ: Nairobi bourse IPO drought persists into the New Year

In the preceding five years (2006 to 2011) the bourse recorded eight IPOs, which brought into the market some of the largest listed firms including Safaricom, KenGen, Co-operative Bank, Britam and thousands of new investors.

However, the current nine-year low at the NSE is likely to put off potential entrants as raising money will be an uphill task.

In its 10-year master plan, CMA had identified challenges associated with NSE’s slow growth to IPO drought and resolved to target three to four companies to list on the Growth Enterprise Market Segment annually.

Mr Muthaura said that businesses with high potential to list will be nurtured and a pipeline of successful enterprises developed to help CMA achieve its goals.

Firms have until February 10 to enrol for the listing experience event.