Kenyan firm to earn huge fees in MTN Uganda IPO

Thursday October 14 2021
MTN PIC

By Daily Monitor

MTN Uganda has picked Kenyan investment bank, Dyer and Blair, to assist with its initial public offering (IPO) guaranteeing the firm, owned by billionaire businessman Jimnah Mbaru hefty fees.

The $250 million IPO opened on Monday.

Investors can apply for shares through SBG Securities, a subsidiary of South Africa's Stanbic Holdings Plc and Dyer and Blair which is the lead retail broker.

"MTN Group (has) appointed SBG Securities Uganda Limited as transaction adviser and lead sponsoring broker, S&L Advocates as legal advisers, KPMG Certified Public Accountants as reporting accountant, Crested Stocks and Securities Limited, and Dyer and Blair Uganda Limited as lead retail brokers and Equity Stockbrokers Uganda Limited and UAP-Old Mutual Financial Services Uganda Limited as selling agents," said MTN Group in the IPO prospectus.

The Business Daily could not immediately establish the exact commission Dyer and Blair would attract compared to the possible number of shares sold.

MTN, however, said the legal adviser S&L will take home Ush1 billion (about $280,000) while the transaction adviser SBG securities will pocket $2 million.

Advertisement

Reporting accountants KPMG will earn $92,000 while MTN will pay $280,000 to the Ugandan Capital Markets regulator for approval. Placement fees at the Kampala bourse are set at ($2.7 million.

South Africa’s MTN Group is selling 4.47 billion shares in its Ugandan subsidiary at a price equivalent to $0.06 apiece.


The IPO is open to Ugandan investors as well as citizens of other East African Community member states, including Kenya.

MTN Uganda will sell a fifth of its stake to investors.

The telecom, a South African MTN Group subsidiary, has received regulatory approvals to list 20 percent of its shareholding.

*Written by Brian Ngugi