Investors who bought Uganda’s power distributor Umeme Ltd shares will, however, have to deal with uncertainty on performance of the company after a Uganda parliamentary committee recommended cancellation of the firm’s exclusive concession agreement. File
What you need to know:
The shares are expected to start trading at the Uganda Securities Exchange (USE) tomorrow. Thereafter, the power distributor is expected to put in applications with the Kenyan capital market regulators to list at the NSE by introduction.
Disclosures contained in the information memorandum show that the power distributor intends to make the applications for the NSE listing ‘as soon as possible’ after the primary listing on the USE.
The IPO was oversubscribed by 36.9 per cent, an indication of the high investor interest on the region’s equities markets which have now seen the company sell 622.37 million shares to the public.
Proceeds from the sale of the 272.37 million shares worth Sh2.49 billion (Ush74.9 billion) will go towards the payment of a shareholder loan, while proceeds from the sale of the balance of 350 million shares worth Sh3.2 billion (Ush96.25 billion) will accrue to Actis.
Ugandan power distributor Umeme attracted applications for shares from more than six thousand investors in its just concluded initial public offering (IPO).
This gives the company the minimum number of shareholders (1,000) that are required to list on the Nairobi Securities Exchange (NSE), which it has indicated an intention to do through an introduction.
According to the allocation results that were released on Tuesday, the power distributor’s shareholders increased to 6,471 from only seven before the IPO.
Out of the total applicants, 6,450 of them were East Africans.
“There was a good response from Kenyan institutional investors and there were some East Africans who applied. Most of the retail investors were from Uganda,” said Naval Sood, the Stanbic Bank director and head of capital markets and advisory for East Africa.
Mr Patrick Bitature, the Umeme chairman, said in a statement that the company had achieved the objective of having a diverse shareholder base despite the difficult global economic environment.
The shares are expected to start trading at the Uganda Securities Exchange (USE) tomorrow. Thereafter, the power distributor is expected to put in applications with the Kenyan capital market regulators to list at the NSE by introduction.
Disclosures contained in the information memorandum show that the power distributor intends to make the applications for the NSE listing ‘as soon as possible’ after the primary listing on the USE.
The IPO was oversubscribed by 36.9 per cent, an indication of the high investor interest on the region’s equities markets which have now seen the company sell 622.37 million shares to the public.
Proceeds from the sale of the 272.37 million shares worth Sh2.49 billion (Ush74.9 billion) will go towards the payment of a shareholder loan, while proceeds from the sale of the balance of 350 million shares worth Sh3.2 billion (Ush96.25 billion) will accrue to Actis.
Mr John Kamunya, a research analyst at Sterling Capital, said listing Umeme at the Nairobi bourse would give investors another company that they can compare with Kenya’s electricity distributor Kenya Power.
Investors who bought Umeme shares will, however, have to deal with uncertainty on performance of the company after a Uganda parliamentary committee recommended cancellation of the firm’s exclusive concession agreement.
A report by an ad hoc committee of Uganda’s Members of Parliament that has been investigating the country’s energy crisis has recommended cancellation of Umeme’s concession contract.
PAYE Tax Calculator
Note: The results are not exact but very close to the actual.
