Rwanda hopeful of an IPO this year

As most potential issuers are increasingly gaining appetite for listing bonds in the liquidity-scarce market, government says there will be at least one Initial Public Offering (IPO) before the year ends.

As most potential issuers are increasingly gaining appetite for listing bonds in the liquidity-scarce market, government says there will be at least one Initial Public Offering (IPO) before the year ends.

An IPO is when a company sells its shares to the public for the first time.

Government is selling part of its stake in some companies through the Rwanda Over-The Counter (OTC) market in order to boost the growth of the stock exchange as well as implementing the privatisation strategy.

Government officials said that floating state-owned company shares on the Rwanda Over The Counter (OTC) market will allow Rwandans to buy into the country’s lucrative firms.

In his budget speech in June, James Musoni the Minister of Finance and Economic Planning singled out insurance company SONARWA, MTN Rwanda and Bralirwa as the firms that have been lined up for sale.

“Regarding the capital market development, during the 2nd half of 2009, some activities started will continue and be finalised while other will start.

Mainly we can recall…privatisation through capital markets,” François Kanimba Governor of the National Bank of Rwanda (NBR) said in the in the latest monetary policy statement.
He said listing government shares in one company before end 2009 is a target.

However most companies which include Bralirwa, MTN Rwanda, and CIMERWA— the largest cement manufacturing company have expressed interest in issuing corporate bonds other than listing shares.

The Rwanda OTC market was launched early last year and it has seen a smooth development with three government Treasury bonds and one corporate bond listed.

In June this year, Kenya Commercial Bank (KCB) cross listed its shares in Rwanda, making it the only company quoted on the Rwanda OTC market wile Kigali City Council is working on the listing of the municipal bond.

In order to improve the regulatory framework, the Capital Market Advisory Council (CMAC) submitted two laws to the Ministry of Finance while the law on the regulation of collective schemes is in the final stages.

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