In a surprising turn of events, the National Social Security Fund (NSSF) of Uganda has stepped forward as the saviour for the telecommunications giant by purchasing over 50 percent of the eight billion shares just four hours before the closure of the struggling Telco’s initial public offering.
Airtel was struggling to garner investor interest or make a third extension to meet its IPO target until NSSF Uganda’s bold move.
Seeking to sell at least 20% of its floated stock, Airtel, had been grappling with a lack of investor enthusiasm, causing concern among stakeholders. However, NSSF Uganda’s timely intervention has injected much-needed confidence into the market and alleviated anxieties surrounding the telco’s future prospects.
In a joint statement issued by the NSSF Managing Director Patrick Ayota and Airtel Uganda CEO Manoj Murali on Friday afternoon, Uganda’s biggest pension scheme has invested $52.7 million (Ush199 billion) for 10.55 percent of the 20 percent stock on offer.
Initially, reports had indicated that NSSF was not keen on investing in the telco for fear of burning its fingers. But the last-minute purchase saved the day.
The USE listing rules require that any company offering shares to sell at least 20 percent of the offer or seek approval from the regulator to extend the offer period.
Airtel was allowed an extension after registering lukewarm response from the market.
The decision by NSSF Uganda to acquire such a substantial portion of Airtel’s IPO shares reflects their confidence in the telco’s long-term growth potential. As a trusted institutional investor, the move demonstrates NSSF Uganda’s commitment to supporting promising ventures within the country and fostering economic development.
This unexpected turn of events could potentially breathe new life into Airtel, providing them with the necessary capital to fuel expansion plans, enhance network infrastructure, and remain competitive in the dynamic telecommunications landscape. The financial boost from NSSF Uganda’s investment could enable Airtel to make significant strides in reaching untapped markets and further improving their service offerings.