Airtel Money shares fell below their initial public offering (IPO) price on Friday, October 9, despite strong investor demand for the mobile money business’s $7 billion London listing.
The shares initially rose to £2.00 before retreating to £1.93, below the offer price of £1.96, in a subdued start to trading on the London Stock Exchange.
The listing, which valued the sub-Saharan African-focused fintech at about $7 billion, was heavily oversubscribed, highlighting investor interest in Africa’s growing digital financial services market.
The secondary share sale raised approximately $703 million for existing shareholders who sold 270 million shares at a fixed price of £1.96 each. Airtel Africa, the parent company, will retain majority ownership of the business.
Airtel Africa owned nearly 78% of Airtel Money before the offering and has said it intends to remain a long-term shareholder.
Airtel Money provides mobile-based financial services, including money transfers, bill payments and digital banking features, across 13 African countries, including Kenya, Malawi and Tanzania.
Sunil Bharti Mittal, founder of Airtel and chairman of Bharti Enterprises, described the listing as a “vote of confidence in the UK as an attractive global destination for investment”.
Dan Coatsworth, head of markets at AJ Bell, said Airtel Money had been among the most popular London IPOs on the investment platform among retail investors.
He noted that Airtel Africa had delivered substantial returns to investors since its stock market debut in 2019.
“Airtel Money’s majority shareholder Airtel Africa has made investors big money since its stock market debut in 2019, with a 262% gain in value to £11.2 billion,” Coatsworth said.
“Many people will be hoping for a repeat of this success with the new IPO.”
Airtel Africa shares, however, fell about 6% in London amid a broader sell-off in telecommunications stocks following SpaceX’s acquisition of spectrum in the United States, which raised fresh competitive concerns in the sector.
