Big success for Airtel Malawi IPO

Airtel Malawi’s IPO was oversubscribed by 34% when the company offered its shares on the Malawi Stock Exchange. Tom Minney reports

Investors came calling when telecommunications firm Airtel Malawi offered its shares to Malawian and then international investors. It has a total of 11bn shares of which it offered 2.2bn to be listed, including an offer for sale of 1.65bn shares and an overallotment of 550m shares.

This was oversubscribed by 34%, and the shares were priced at MWK12.69 (1.7 US$ cents) each, according to an announcement on 14 February. 

The offer opened on 27 December and closed on 31 January. It raised MWK27.92bn ($38.1m), which is to be paid to the major shareholder, Bharti Airtel Malawi Holdings BV, based in the Netherlands and a subsidiary of Airtel Africa PLC, which is listed on the London Stock Exchange. 

The share will be the 15^th listing on the Malawi Stock Exchange, with the listing scheduled for 24 February. The lead transaction advisor is Standard Bank Plc and the sponsoring broker is Stockbrokers Malawi Ltd. 

The share offer lets Airtel comply with the conditions of Malawi’s Communications Act of 2016 and its licence, which requires a minimum 20% local Malawian shareholding. 

According to the prospectus issued on 20 December, Airtel Malawi had overtaken its main competitor in 2005 and at December 2018 had 54% market share and 4m subscribers, offering coverage to 85% of the population.

It has been named Malawi’s “most popular brand”. It was the first to roll out mobile data and a mobile wallet in Malawi. Airtel Money has 17,000 agents. Mobile penetration rates in Malawi are still close to half the overall African penetration rate.