Singtel-tied Airtel Africa sets price range for LSE IPO to raise more than S$1 billion

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Airtel Africa set the price range Monday for its initial public offering (IPO) at 80 pence to 100 pence a share, the telco said in a filing to the London Stock Exchange.

Final pricing is due to be announced on 28 June, with conditional dealing in the shares expected the same day, the filing said.

That implies a market capitalization of 3.01 billion British pounds to 3.62 billion pounds (US$3.79 billion to US$4.57 billion or S$5.19 billion to S$6.25 billion), excluding the over-allotment option, which is for 10 percent of the offering, the filing said.

“We have built Airtel Africa into the second largest mobile operator in Africa and our clear strategy and efficient business model make us well positioned to capture the growth opportunities across our markets, in voice, data and mobile money,” Raghunath Mandava, CEO of Airtel Africa, said in the statement.

“Our leadership position, positive track record and the exciting growth opportunities in the markets where we operate, have resulted in significant interest in our business,” Mandava added. “We are excited to be able to give an opportunity to a broader audience of institutional investors to participate in some of the fastest growing telecom and payment markets in the world through the IPO of Airtel Africa shares on the London Stock Exchange.”

Around 595.2 million to 744 million new shares will be issued, with gross proceeds of around 595 million pounds, including the over-allotment option, Airtel Africa said. Excluding the overallotment option, gross proceeds of around 541 million pounds are expected, the telco said.

Bharti Airtel has previously said the proceeds will be used to repay existing debt.

The free float after listing is expected to be at least 25 percent of the issued share capital, making it eligible to be included in the FTSE UK indexes, the telco said.

At the same time, Airtel Africa plans to list its shares on the Nigerian Stock Exchange, it said.

J.P. Morgan Securities PLC is the sole sponsor, Airtel Africa said.

BofA Merrill Lynch, Citigroup Global Markets and J.P. Morgan Securities are joint global coordinators and joint bookrunners, while Absa Group, Barclays Bank’s investment bank, BNP Paribas, Goldman Sachs International, HSBC Bank and the Standard Bank of South Africa are joint bookrunners, the filing said.

Airtel Africa is the continent’s second-largest telecom operator, with a customer base of 91 million and is in the top two in most of its 14 markets, Singtel said in October, adding the mobile wallet service, Airtel Money, has 11.8 million subscribers.

Singtel is the single largest shareholder in Bharti Airtel with an effective interest of 35.2 percent, and it has also invested directly in Airtel Africa.

Africa is expected to be the world’s fastest growing mobile market, with unique mobile subscribers expected to rise to more than 500 million by 2020 from 420 million at the end of 2016, Singtel said in October, citing data from a GSMA 2017 mobile economy report.

Correction: An earlier version of this article misspelled Singtel in the headline.

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