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Capital Markets

NSE enrols third firm for incubation before listing

Geoffrey Odundo
Nairobi Securities Exchange CEO Geoffrey Odundo. FILE PHOTO | NMG 

The Nairobi Securities Exchange (NSE) Thursday enlisted the third firm on its incubation programme as it revealed that another 20 had already expressed interest to join the same.

In total, the NSE is banking on its new incubation programme in a bid to raise the number of companies listed on the stock market.

Chief executive Geoffrey Odundo said the Ibuka (Swahili for emerging) incubation and acceleration programme will enlist as many as 30 firms over the next two months to help them build strong structures so that they list on the market when already stable.

“On completion of accelerator stage, companies will be ready for either initial public offer (IPO) or doing capital market financing. We believe this will help us enlist more firms,” said Mr Odundo in Nairobi.

Onboarded companies, mostly small and medium size enterprises (SMEs), will take six to 18 months in the programme, in what NSE calls a radical surgery of business to make them investor-ready.

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Listing

This is a departure from the past where the NSE has been waiting on businesses to put their house in order then approach them for listing, a process that has proved slow and sometimes exposed new shareholders and creditors to losses.

“The capital markets is a very attractive opportunity, this is a very good channel to list faster,” said Mr Odundo.

He spoke when the NSE welcomed on board Moad Capital, a real estate focused firm as the third of as many as 20 companies that have expressed interest in the programme.

Companies on-boarded on Ibuka programme will choose advisors to help them restructure the business and prepare them for capital financing. This will involve scanning through and reshaping balance sheet, key ratios and governance structures.

Moad Capital is the third firm to be enlisted on the Ibuka programme after Jambo tea maker, APT Commodities Limited and tour and travel firm, Globetrotters Agency, came on board recently.

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