The country’s telecom operator, Airtel Uganda, has disclosed that it intends to sell the remaining shares from its undersubscribed Initial Public Offering (IPO) to satisfy legal obligations.

The telco’s representative, David Birungi, highlighted the company’s dedication to following the national standards, noting that they want to comply by November 2026, within two years.

The telco’s plan to strengthen its financial position and expand its operations nationwide includes the IPO. The company plans to use the money acquired from the IPO to expand its network infrastructure, enhance customer service, and launch new products that would cater to the changing needs of its clientele.

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Airtel Uganda only sold 54.45% of shares last year

In 2023, the telecom company raised USh800 billion ($216.22 million) through an IPO but only sold 54.45% of the 8 billion shares.

The telco reported a 9.6% fall in profit for the year ended December 2023 and announced a final dividend of USh86 billion ($22 million) in March 2024. Thanks to solid results in its primary phone and data businesses, its total sales increased by 11.5% to Ush1.7 trillion ($455 million).

“We exceeded expectations with gross revenue of Ushs 1,784 billion in 2023, a remarkable 11.5 per cent increase compared to Ushs 1,599 billion in 2022,” the telco said.

Following MTN Uganda, primarily owned by the South African MTN Group and listed in December 2021, Airtel Uganda became the second telecommunications business listed on the Ugandan stock exchange, with over 14 million active users dispersed throughout 146 districts in Uganda.

Airtel was the first mobile cellular network in Uganda, and it first entered the market in 1995 under the name Celtel Uganda. It has since expanded quickly.

Its biggest rival, MTN Uganda, revealed in June 2024 that demand for the remaining shares from its 2021 IPO had surpassed projections by about 100%.1.6 billion shares were offered, but 3 billion shares were applied for. The percentage of the company’s equity that was sold is 7.03%.

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Public listing mandate for Telecommunications in Uganda

Telecommunications businesses are required by Uganda’s broadband policy to publicly list a minimum of 20% of their shares on the local stock exchange. It is required by law, as stipulated by rules that went into effect in 2019 and 2020.

President Yoweri Museveni was a prominent supporter of the rule, claiming that the foreign-owned telecom companies damaged the local economy by repatriating most of their revenues. According to Mr Museveni, they should list on the Uganda Stock Exchange to lessen that.