Rwanda’s Permanent Secretary in the Ministry of Local Government Vincent Munyeshyaka rings the bell to mark the beginning of trading in Uchumi Shares at the Rwanda Stock Exchange (RSE) witnessed by RSE chairman Dr. James Ndahiro (in glasses) and Uchumi chief executive officer Jonathan Ciano (right)
What you need to know:
Uchumi Supermarkets shares on Monday started trading on the Kigali bourse, giving the company wider pool of potential investors from which it can raise capital.
It is also seeking approval to cross-list its shares at the Dar es Salaam Stock Exchange and Uganda Securities Exchange ahead of its planned cash call.
The supermarket chain plans to sell 100 million shares to existing shareholders through a rights issue.
Uchumi Supermarkets shares on Monday started trading on the Kigali bourse, giving the company wider pool of potential investors from which it can raise capital.
The Nairobi Securities Exchange (NSE) listed supermarkets chain now has visibility to potential customers in the Rwanda market where it also hopes to expand operations.
It is also seeking approval to cross-list its shares at the Dar es Salaam Stock Exchange and Uganda Securities Exchange where it already has subsidiaries, a move that will further widen its pool of potential investors during its planned cash call.
“As our drive towards regional growth gains momentum, so has our desire to make Uchumi shares accessible to more stakeholders across the region,” said Jonathan Ciano, Uchumi’s chief executive officer.
The supermarket chain plans to sell 100 million shares to existing shareholders through a rights issue.
During the company’s 32nd annual general meeting in December last year, Mr Ciano in a presentation said that the super market chain was targeting to raise Sh1.5 billion, but at a later press conference said the amount to be raised will determined by the company’s expansion budget and the retailer’s market price at the time of issue.
“It is, therefore, timely and ideal that as we plan to set Uchumi branches in this market that we also empower investors here to stake a claim to the ownership of Uchumi, and all our East African Citizens should pride themselves for owing a piece of the supermarkets”, he said during Monday’s launch of trading in Kigali.
In May this year Uchumi Supermarkets appointed Faida Investment Bank as the transaction advisor and sponsoring broker, Equity as the receiving bank, Hamilton Harrison & Mathews Advocates as the legal advisor and Ernst &Young as the reporting accountants.
The supermarkets chain profit after tax for the full year ended June 2013 jumped 30.31 per cent to Sh357.01 million compared to Sh273.97 million as at June 2012 despite a rise in costs, partly attributed to branch expansion.
The branch expansion, which saw the supermarket’s chain open new branches in Ongata Rongai in Nairobi, Natete in Kampala and the Eldoret Sugar Plaza resulted in an increase of customer numbers by 10 per cent to 24 million from 22 million.
However, despite the increase in the number of customers sales revenues rose by a marginal 3.23 per cent to Sh14.36 billion for the year ended June this year from Sh13.91 billion for the year ended June last year reflecting the tough operating environments particularly in Kenya and Uganda.
As at the end of June this year, the company had 22 branches in Kenya, 5 in Uganda and 1 in Tanzania.
“Uchumi has, by this cross-listing, shown its confidence in our financial sector and the growth of our economy thus giving our people the opportunity to own a supermarket through the buying of Uchumi Supermarkets shares,” said Vincent Munyeshyaka Rwanda’s permanent secretary in the Ministry of Local Government.
The supermarket’s chain closed at Sh21 on Monday at the NSE a 9.95 per cent gain from Sh19.10, its closing price at the end of last year.
