International pool price 10% higher in Safaricom IPO

8 May 2008

The application period for the international pool opens today in the initial public offering (IPO) of Safaricom, Kenya’s largest cellco by subscribers. The price for the international pool has been set at KES5.55 (USD0.9) per share, adding a 10% premium to the KES5 price for domestic investors.

Local interest has generated KES115 billion from over 750,000 applications. Share allocations are to be announced at the end of May while shares are expected to be issued by 4 June. The company’s shares are expected to start trading at the Nairobi Stock exchange on 9 June.

The Government is selling 25% of its 60% stake in Safaricom, equating to ten billion shares. 35% of the total available are on offer for foreign applicants but with a caveat that the reserved lot could be cut by up to 15% if the domestic pool is over-subscribed by more than 200%. It has, however, emerged that should local investors fail to take up all the shares allocated to them, foreign investors could get up to 80% of the issue.

Following the IPO, the public will hold 25% of the issued ordinary share capital of Safaricom, with the government holding 35% and Vodafone Kenya ’s shareholding remaining unchanged at 40%. The government and Vodafone Kenya have agreed not to sell any further shares for at least 180 days following the IPO.

Kenya, Safaricom