The Capital Markets Authority (CMA) has given the green light for the listing of Ugandan power distributor Umeme Limited's shares on the Nairobi Securities Exchange, barely weeks after the firm went public in Kampala.
CMA authorised Umeme to list on the Main Investment Market Segment of the Nairobi Securities Exchange (NSE) by introducing 1,623,878,005 ordinary shares.
The listing follows a recent Initial Public Offer of 273.37 million shares on the Uganda Securities Exchange, which was oversubscribed by 36.9 percent.
"The authority has granted approval following thorough review of the applicant's documents and is satisfied that Umeme Limited has adequately disclosed all material information in accordance with the requirements of the Capital Markets Act and the Capital Markets (Securities) (Public Offers, Listing and Disclosures) Regulations, 2002," the CMA pointed out in a statement released to newsrooms.
Listing by introduction and initial public offers are two ways in which companies can participate at the NSE and an introduction is an application for listing of shares already in issue where no marketing arrangements or offer for subscription are required.
Umeme was formed in 2004 when the Government of Uganda sold Uganda Electricity Distribution Company Limited (UEDCL) to a consortium belonging to Globeleq (56 percent), a subsidiary of the Commonwealth Development Corporation (CDC) of the United Kingdom and Eskom (44 percent), the electricity generating company of South Africa.
In 2006, Eskom sold its 44 percent investment in Umeme to Globeleq, making it the sole shareholder with 100 percent ownership by the end of December 31, 2006 and in October 2009, the ownership of Globeleq was transferred to CDCGroup plc and it was renamed Umeme Holding Limited.
Umeme took over the distribution system and licence to distribute and supply power in Uganda under a Concession arrangement with effect from March 1, 2005 for a period of 20 years.
Under the Concession, Umeme is also required to repair, upgrade and expand the distribution systems.
Umeme's shared purpose is "electricity retail and distribution business providing exceptional customer services in a safe, reliable and cost effective manner with a workforce that is well motivated and skilled, generating sufficient profits to sustain and build the business while providing value to shareholders."
The power distribution company will list its shares by introduction at the NSE from Friday.