Insurer set for listing on NSE in second half of next year

Corporate News

UAP Group Managing Director Dominic Kiarie. Photo/FILE 

By Victor Juma

In Summary

• UAP’s listing is expected to renew interest at the Nairobi bourse that has registered increased de-listings brought by majority acquisitions of publicly traded firms.

UAP Holdings is set to list on the Nairobi Securities Exchange in the second half of next year through introduction. This means the company will not be raising funds at the market but will list its 211.4 million issued shares, allowing its current shareholders an easier exit route.

 

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“It is expected that a listing by introduction at the NSE will be carried out in the second half of 2015,” said UAP chief executive Dominic Kiarie.

The firm’s shares have been available for purchase only through over-the-counter (OTC), with the stock currently trading at Sh86. This gives the company a market value of Sh18.1 billion.

UAP’s listing is expected to renew interest at the Nairobi bourse that has registered increased de-listings brought by majority acquisitions of publicly traded firms.

The last company to list on the bourse was real estate firm Home Afrika in July last year, coming a month after I&M Bank’s listing. Both companies listed by introduction.

Easier exit
Investment firm TransCentury also went public by introduction in July 2011, with financial services firm Britam making an IPO in September 2011.

Increased preference for listing by introduction signals that most founder shareholders see the market more as a tool for price discovery and easier exit than an opportunity to raise funds.

UAP’s listing is set to counter the recent spate of de-listings, including that of Internet firm AccessKenya and auto dealer CMC Holdings. CMC has been fully acquired by Dubai-based Al-Futtaim Group for Sh7.5 billion, following AccessKenya whose Sh3 billion buyout by Dimension Data was completed in January.

UAP’s major shareholders include its chairman Joseph Wanjui with a 21 per cent stake. Others are investment firm Centum (13 per cent), billionaire investor Chris Kirubi (Sh9.1 per cent) and former UAP chief executive James Muguiyi (5.6 per cent).

These founder investors were diluted 45.9 per cent by three private equity funds that took a 40 per cent stake in UAP when they participated in a 2012 public offer that raised Sh4.7 billion.