Airtel Africa shares slumps on London IPO opening

Airtel Africa

With about 12% drop within a few minutes, shares of Airtel Africa Plc has slumped on its initial public offering debut day at the London Stock Exchange.

Opening at 77 pence per share, the company’s shares fell 67 pence before regaining slight strength back to 71 pence per share.

Airtel Africa’s entrance into the public market is a dual listing across Nigerian Stock Exchange as well as the London Stock Exchange.

It is not yet clear how its Nigerian listing will pan out. To avert raising less than the expected amount, the company will only a private bookbuild for its shares targeting high net-worth individuals, HNIs.

Earlier this week, we reported that one of the bookrunners handling the dual initial public offering of Bharti Airtel Africa B.V. said it has received about $200 million in pre-listing orders.

In May, Airtel Africa announced that it will look to raise up to $1 billion in the IPO.

There are several reasons behind the sharp drop in prices on an opening day. Airtel Africa has a lot of debt on its books and it has not turned a profit for a while, even the IPO money will be used to pay its debt.

Operating across Nigeria, francophone and other Anglophone markets, the listing will give the African mobile carrier exposure to global capital.