Airtel plots Nairobi IPO to meet local ownership requirements

15 Mar 2013

Airtel Kenya plans to sell at least a 15% stake to local shareholders through the Nairobi Securities Exchange (NSE) in order to meet long-standing local ownership limits stipulated by the government. According to Business Daily Africa, India’s Bharti Airtel, which owns 95% of the mobile operator, says that an initial public offering (IPO) is the best route to bring the company in full compliance with local ownership regulations which require all telecoms firms to maintain at least 20% Kenyan shareholding. The development was revealed by Information Permanent Secretary Bitange Ndemo, who met with Airtel earlier this month to hear the company’s appeal for a postponement. The Indian parent argued that finding a buyer for the surplus 15% stake – which is valued at around KES6 billion (USD69.1 million) – was difficult given that the Kenyan business has yet to generate a profit since it was acquired three years ago. As such, the government has agreed to a new exemption that is not limited to a pre-determined period; Airtel can only list with the NSE after posting profits for three consecutive years.

Kenya, Airtel Kenya