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The Buganda Kingdom has applied to buy 2,000,000 Airtel Uganda shares, worth UGX200 million in the ongoing Airtel Initial Public Offering.
This was revealed at a press conference held on the 26th of September 2023 at the Kingdom’s Bulange, Mmengo offices, where the Kingdom’s Prime Katikiro (Prime Minister) Owek. Charles Peter Mayiga, took the opportunity to encourage the public to embrace the #AirtelIPO, saying, IPO investments in well-run and regulated businesses such as telcos, are smart investments.
“Be a smart investor, acquire shares in publicly listed companies. With the company’s growth, the shares will appreciate, “ he said, adding that because of the strict regulatory regime around listed companies, earnings from such investment were “hassle-free” compared to traditional ventures such as salons, matatus, or rentals.
He also said that because of enhanced corporate governance in listed companies, investing in shares was an “investment where others work for you”.
The telco has put up for the IPO, 8,000,000 shares (20% of the issued shares) for UGX100 per share. The offer shall close on 13th October 2023 and thereafter the company shall on 31st October 2023, list the entire 40 billion shares on the Main Investment Market Segment of the Uganda Securities Exchange (USE). This values the company at UGX4 trillion.
This will be Uganda’s second largest and second telco IPO after the 2021 MTN Uganda IPO in which 4,477,808,848 shares (20%) were put up for sale at UGX200, valuing the entire company at the time at UGX4.48 trillion.
The telco which has been present in Uganda since 1995, is the second largest with a close-to-call 49% revenue market share and 47.3% subscriber market share, respectively.
The public show of confidence by the Buganda Kingdom is the most recent, in a raft of other endorsements such as by serial stocks investor and billionaire businessman, Dr. Sudhir Ruparelia. Old Mutual Investment Group, one of Africa’s leading investment managers as well as regional investment bank, Dyer & Blair have also separately given the IPO, a “buy” rating mainly on account of previous and projected good performance, boosted by bullish industry prospects.
Manoj Murali, the Managing Director of Airtel Uganda, said the Buganda Kingdom investment was a “momentous occasion in the enduring partnership between Airtel Uganda and the Buganda Kingdom”.
“This decade-long collaboration has enjoyed the support and belief of His Majesty,” Mr. Manoj said.
Since 2014, Airtel Uganda has been a crucial partner in driving transformative initiatives and in March 2023, the two entities agreed to renew the partnership for another three years.
Majestic Brands, the investment arm of the Kingdom has a wide range of commercial interests in real estate, telecommunications, media and education.
Robert Baldwin, CEO of Crested Capital, the lead sponsoring broker, commended the Kingdom’s investment, acknowledging that it would yield substantial future benefits for the Kingdom.
“We are delighted to see the Kingdom of Buganda announcing the acquisition of 2 million shares. This represents a significant investment of Ugx 200 million, which will earn the Kingdom an additional 100,000 incentive shares as part of the Initial Public Offer,” he remarked.