Airtel Africa, a frontline telecommunication company, has disclosed it has purchased an aggregate number of 40, 921 ordinary shares at 0.50 USD each from Citigroup Global Limited.
The said purchase took place April 19, 2024, on the London Stock Exchange in pursuant to the authorities granted by its shareholders, and as part of its shares buy-back program, details of which were announced on March 1, 2024.
A share buyback means that Airtel is purchasing its shares from the markets. According to investopedia, a financial decision and information platform, Stock buy-back allows a company to reinvest itself that is the repurchased shares are absorbed by the company reducing the number of outstanding shares on the market, thus companies can either follow the Tender offer route or Open Market route.
According to a document sighted by our correspondent, titled “Transaction in Own Shares,” Airtel Africa purchases the volume weighted average price paid (GBP), was 107.53, while the lowest paid per share and the highest paid per share in (GBP) are 107.10, and 107.80 respectively. The document also noted that the purchased ordinary share will be canceled.
The buyback program, which began on March 1, 2024, involves the repurchase of $100 million worth of Airtel Africa’s shares in 12 months and is divided into two tranches, with the first tranche of $50 million running from March to August 2024. The buyback program will help reduce share capital and lower debt and operating costs.
Of significance to note is the fact that, since the commencement of the share buy-back programme announced on March 1, 2024, the company purchased 11, 995,292 ordinary shares in aggregate, at a volume-weighted average price of GBP 98.86 per ordinary share.
Meanwhile, emerging facts underscore that Airtel Africa, had a tough 2023, the telecommunication company reported a significant loss after tax of $151 million in Q1 of 2023, and ultimately a 99% decline in profits, dropping from $523 million to $2 million by the year-end.
Currency devaluations in key markets like Nigeria, Malawi, Zambia, and Kenya, were the main cause for the loss.
Thus, to improve its financial health and standing the telecommunication giants announced plans for a share buy-back program in February 2024.
In its share-buyback programme, Airtel Africa has acquired a total of 8.6 million shares from Citigroup Global Limited
