Stock Market Regulator To Pocket sh1bn From MTN Listing

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The Capital Markets Authority expects to reap Non Tax Revenue of sh1.15b from the listing of telecom giant MTN Uganda on the Uganda Securities Exchange.

This was disclosed by the Chief Executive Officer of the authority Keith Kalyegira while appearing before the Finance Committee of Parliament on Wednesday afternoon.

The meeting chaired by the vice-chairperson of the committee Jane Pachuto was called to discuss the performance of the authority as the committee prepares to receive the policy statements of Ministries Departments and Agencies.

Agule County MP Francis Mukula had asked Kalyegira to explain the funding gaps that the authority is experiencing.

In his explanation, Kalyegira pointed out that the authority only has an annual budget of sh6.1b, but expects to increase that to sh7.25b in the next financial year 2021/2022 following the listing of one telecom company.

Although he declined to disclose before MPs the name of the telecom, he later told URN that MTN Uganda is one of two telecoms that has come forward to fulfill its obligation to float shares within the required two years of renewing its license.

Kalyegira notes that the additional sh1.15b will be obtained from non-tax revenue that the authority expects to receive from the listing of MTN Uganda and the resultant trading commissions in the market.

Following a protracted negotiation that dragged on for nearly two years, MTN Uganda finally reached an agreement for a long-term renewal of its operating license in Uganda. MTN Uganda reached an agreement with Uganda Communications Commission to pay $100m for a 12-year license in Uganda valid from July 1, 2020.

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An initial public offering was one of the conditions for the renewal of the license. According to reports, MTN Uganda is expected to list at least 20 percent of its shares. MTN Uganda reported a 9.1% increase in net profit to sh442.6b for the first six months of 2020.

The performance was driven by the strong performance of mobile money, data and digital income.

Overall, the company’s revenues grew by 7.6% to sh900b in the period while data incomes jumped from sh128b to sh167b representing a 30% growth.

A source disclosed to URN that the second telecom company expected to list on the USE within the next 18 to 24 months is Airtel Uganda.


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