With a debt already close to 70% of its GDP, the IMF projects that Kenya plans to borrow $12.4bn from foreign sources by June 2022. This, at ... a time when the country is at a high risk of debt distress and subject to zero limits on non-concessional borrowing. But the distress is also having a cause and effect on its population.
The teleco Airtel is looking to Africa to spur its growth, with its Indian operations grappling with debts at home and the drive to develop 5G networks there.
The secondary listing of Airtel Africa, the second-largest operator on the continent after MTN, was initially billed for last week but was postponed.
Airtel has been worried about the market’s appetite for telecos in emerging markets. Last month, Airtel Africa’s shares plunged on the London exchange by about 16%. It had raised about $750m during that listing.
When complete, the value of the Nigerian free float listing will be N1.354trn ($3.8bn) – approximately half the size of that of its competitor, MTN Nigeria. This value makes it one of the top stocks on the NSE in terms of capitalisation – joining the league of Dangote Cement and MTN Nigeria – and bigger than the London one.
Airtel had announced that the listing was of 39,227,968 ordinary shares at N363 per share. They ended the day with a tidy rise, reaching N399.3. It was a boost for the Nigerian market, as worries mount about the country’s political go-slows and economic direction.
Airtel in Africa
Airtel Africa is the parent company of Airtel in 14 African countries, including Nigeria. Nigeria is Airtel’s biggest African market, and it held 26.3% of market share in May of this year, according to the latest data from the Nigerian Communications Commission. That puts it just behind Globacom (26.8%) and well behind South Africa’s MTN (37.4%).
Many African governments have been pushing telcos to list their shares on local bourses as a commitment to developing the local financial sectors. As a top player in Nigeria, Airtel has so far avoided the clashes with the authorities of its peer, MTN.
According to a statement released by the NSE, a special waiver was granted to Airtel after the telecom operator could not gather the required minimum of 300 shareholders, an important criterion for a company looking to list on the platform.
Why this is important: With multinationals like Airtel and MTN swelling the ranks of the NSE, more foreign entities could decide to follow suit and lead to a more robust stock market.
Understand Africa's tomorrow... today
We believe that Africa is poorly represented, and badly under-estimated. Beyond the vast opportunity manifest in African markets, we highlight people who make a difference; leaders turning the tide, youth driving change, and an indefatigable business community. That is what we believe will change the continent, and that is what we report on. With hard-hitting investigations, innovative analysis and deep dives into countries and sectors, The Africa Report delivers the insight you need.View subscription options