LONDON: Airtel Africa today has confirmed its intention to proceed with an initial public offering (IPO) and intends to apply for admission of its ordinary shares to the premium listing segment of the official list of the Financial Conduct Authority and to trading on the main market of the London Stock Exchange (LSE).
[the_ad id=”32940″]The offer will comprise new shares to be issued by the Airtel Africa to raise gross proceeds of approximately $750 million.
The indicative price range in respect of the offer, as well as the number of Shares to be sold in the offer, will be determined in due course and contained in the prospectus expected to be published by Airtel Africa in the coming weeks.
The final offer price in respect of the offer will be determined following publication of the prospectus and a book-building process, with admission currently expected to occur in July 2019. Prior to admission, the company will be re-registered as a public company limited by shares and renamed Airtel Africa plc.
The company intends to use the net proceeds from the issue of new shares to reduce net debt. The company intends to distribute to its shareholders a minimum of 80 per cent of consolidated free cash flow as long as a ratio of net debt to EBITDA between 2 to 2.5 times is maintained, subject to all regulatory, statutory and monetary restrictions. At the individual operating country level, the Company will recommend to the local boards a dividend pay-out of a minimum of 80 per cent of the free cash flow at the country level as long as a ratio of net debt to EBITDA between 2.5 to 3.5 times is maintained, subject to all regulatory, statutory and monetary restrictions.
The Company intends to distribute dividends in an interim and final divided format, with the first interim, dividend expected to be declared following the half year results for the six months ending September 2019, subject to policy and approvals.
Airtel intends to have a free float of at least 25 per cent of the Company’s issued share capital and expects that it would be eligible for inclusion in the FTSE UK indices. Certain of the Company’s pre-IPO investors are expected to contribute towards the minimum 25 per cent free float. In addition, it is expected that up to a further 15 per cent of the offer (100 per cent primary) will be made available pursuant to the over-allotment option.
The company is also considering a listing of its Shares on the Nigerian Stock Exchange. If the Company decides to proceed with a listing on the Nigerian Stock Exchange, such listing would only take place after the approval of the Nigerian Securities and Exchange Commission and the Nigerian Stock Exchange has been sought and obtained.