Airtel Kenya consider shareholding options

Bharti Airtel is looking to list a 15 per cent stake in its Kenyan subsidiary on the local stock market in order to bring the company in line with local limits on foreign shareholding.

Currently, Airtel Kenya is 95 per cent owned by the Indian parent company, and attempts to sell a 15 per cent stake to a local investor have proven difficult. Hence the plans for a stock market listing to bring the Indian company’s holding down to the 80 per cent maximum allowed.

Airtel has been trying to find a buyer for the 15 per cent stake since it acquired the company in 2010, but as it is still a loss making subsidiary, investors have been unwilling to invest.

The government has granted an exemption so far while Airtel seeks a buyer, and had agreed to extend that until Airtel is able to list its shares on the Nairobi Securities Exchange (NSE).

The listing may itself be delayed though by NSE rules that require companies to have posted at least three years of profits prior to listing.

Airtel Kenya expects to break even within two years, which puts a listing at 2018 at the earliest under the current rules.