Companies

Umeme suspends trading as it seeks sale of 14.3pc stake

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Ugandan power firm Umeme Limited has suspended trade in its shares on the Nairobi and Kampala bourses pending sale of a major stake by key shareholder Actis. PHOTO | FILE

Summary

  • Under the listing rules of the USE, a company can apply for a voluntary suspension of trading ‘for a justifiable cause’, with the USE accepting Umeme’s application on the grounds that the Actis’ transaction may have an effect on the price of the company’s shares.
  • The Uganda bourse accepted Umeme’s application on the grounds that the Actis transaction may have an effect on the price of the company’s shares.
  • The company has listed 1.62 billion shares in the Nairobi bourse, giving it a market capitalisation of Sh25.6 billion.

Trading in shares of Ugandan power firm Umeme at the Nairobi Securities Exchange (NSE) will remain suspended for the next two weeks to allow for the sale of a significant stake in the firm held by British private equity firm Actis.

Umeme, which is cross listed on the NSE and the Uganda Stock Exchange (USE), announced on Monday that it has received notification from Actis’ subsidiary Umeme Holdings Ltd that it plans to offload its 14.3 per cent stake to a number of investors through private placement.

Under the listing rules of the USE, a company can apply for a voluntary suspension of trading ‘for a justifiable cause’, with the USE accepting Umeme’s application on the grounds that the Actis transaction may have an effect on the price of the company’s shares.

“Umeme has requested the USE to suspend trading in the shares of the company for a maximum period of two weeks starting from November 7 to November 15, which request has been approved,” said Umeme in a statement Monday.

“In light if the suspension of the shares of Umeme from trading in the market of their primary listing, the shares will similarly be suspended from trading on the NSE.”

Actis, which initially held a 60 per cent stake in Umeme, sold a 45.1 per cent holding in similar deals to private investors in 2014, meaning that the firm is exiting the Umeme investment with the planned sale of the remaining 14 per cent.

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

The company has listed 1.62 billion shares in the Nairobi bourse, giving it a market capitalisation of Sh25.6 billion.

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