The offer involves existing shareholders selling 270 million shares, equivalent to about Sh46.5 billion at the offer price Airtel Money has set the price of its planned London Stock Exchange initial public offering (IPO) at £1.96 (about Sh338) per share. This gives the mobile-money business an estimated market capitalisation of £5.3 billion, equivalent to about Sh913.1 billion.
The valuation marks a major step in Airtel’s plan to separate its financial-services business from its traditional telecommunications operations and establish Airtel Money as an independently listed company. The offer involves existing shareholders selling 270 million shares, equivalent to about Sh46.5 billion at the offer price.
A further 27 million shares, worth about Sh4.65 billion, could be sold if the over-allotment option is exercised. The company itself is not expected to sell shares, except through the over-allotment option. Airtel Africa is expected to remain a long-term strategic shareholder, signalling that the listing is intended to give Airtel Money greater independence while retaining the backing of its parent company.
The International Finance Corporation has also committed to buy up to £67.2 million, about Sh11.58 billion, of shares from existing shareholders under a cornerstone investment agreement. The announcement puts the equivalent value of the investment at about $90 million, or Sh11.67 billion.
“Before making any investment decision, potential investors should read the Prospectus, expected to be published by the Company later today,” the firm said in a notice. The development is significant for Kenya because the country is one of Airtel Africa’s 14 markets and has an increasingly important Airtel Money operation.
Airtel Money Kenya is separately incorporated and regulated by the Central Bank of Kenya as a payments-services provider, while Airtel Networks Kenya remains the telecommunications company.