Capital Markets

PE firm Actis cuts Umeme stake to 14pc

Actis shareholding in Ugandan utility provider Umeme has dropped from 60.30 per cent to 14.30 per cent in a month in a strategic partial exit.

The UK-based private equity firm has over the past month been selling its stake in the power firm with regional institutional and retail investors as well as Umeme employees among the major takers.

“The successful take-up of Ugandan shilling 18.4 billion (Sh632 million) by retail investors over a short 10 day trading period further validates the deepening of Uganda’s capital markets and the broad appeal of the Umeme story across all investor classes,” said Patrick Mweheire, the lead transaction advisor at Stanbic Bank in a statement.

Brokers expect that the sale to a wider pool of investors will make the share more attractive by increase the number of shares available for trading.

“This offer is expected to increase the level of liquidity on the counter which will further boost its activity on the bourse,” said a research note on Umeme by Crested Stocks & Securities Ltd.

Umeme’s management and directors increased their shareholding to five per cent from two per cent.

South African and London-based firm Investec which has 18.47 per cent stake has replaced Actis as the largest shareholder.

Other large shareholders are the National Social Security Fund (Uganda) with a 14.27 per cent stake and Farallon Capital which has a 7.82 per cent shareholding.

The share is cross-listed on both the Nairobi Securities Exchange (NSE) and the Uganda Securities Exchange.