Airtel Africa has commenced a share buy-back programme to recover shares up to $100 million from its shareholders at both Nigeria and London stock exchanges.
This is culminating from its earlier announcement on February 1 following the publication of its nine-month results ended 31 December 2023, informing the investing public of the development.
According to the leading telecommunications and mobile money services, with a presence in 14 countries across Africa, the share buy-back has commenced today and will return up to $100 million to shareholders over a period of up to 12 months.
A corporate filing at the Nigerian Exchange Limited (NGX) showed that the share buy-back programme would be phased over two tranches, with the first tranche commencing on Friday, February 1 and anticipated to end on or before 31 August 2024.
The statement read: “The first tranche will amount to a maximum of $50 million. The Company has entered into an agreement with Citigroup Global Markets Limited (Citi) to conduct the first tranche of the buy-back and carry out on-market purchases of its ordinary shares with the Company subsequently purchasing its ordinary shares from Citi.”
The Company also intends to enter into arrangements to commence a second tranche of the share buy-back programme in an amount of up to $50 million in due course.
Under the agreement for the first tranche, Citi will act as riskless principal and will make decisions independently of the Company, Airtel Africa revealed.
The sole purpose of the buy-back programme is to reduce the capital of the Company. As such, all shares purchased under the buy-back programme will be cancelled.
It further said: “This buy-back programme reflects the significant progress made in recent years to reduce leverage and strengthen the Company’s balance sheet.
“In light of the cash accretion at the holding company level, the current leverage and the consistent strong operating cash generation, the Company is well positioned to undertake this share buy-back to enhance shareholder returns which is consistent with its existing capital allocation policy.
Further details of the share buy-back programme
Any purchases of ordinary shares under the buy-back programme will be carried out in accordance with certain pre-set parameters set out in the agreement with Citi and in accordance with and subject to the limits prescribed by the Company’s general authority to repurchase ordinary shares granted by its shareholders from time to time.
At the annual general meeting on 4 July 2023, shareholders gave the Company authority to purchase a maximum of 375,815,150 ordinary shares.
The programme is also supported by the Chapter 12 of the Financial Conduct Authority’s Listing Rules and the provisions of the Market Abuse Regulation (EU) No 596/2014 (as it forms part of domestic law by virtue of the European Union (Withdrawal) Act 2018, as amended).
Meanwhile, it stressed that purchases may continue during any closed periods of the Company during the engagement period. For the avoidance of doubt, it assures that no repurchases will be made on the Nigerian Stock Exchange.
