Analysts hail dfcu deal as boost to market

 

 

Kenneth Kitariko, the chief executive officer of African Alliance, says the development is a thumbs up for the market and a good signal for investors because it is an indication that an investor can enter the market and exit when the right opportunity presents itself.

 

The development is especially positive at a time when trading volumes were on the decline on the market.

 

Two new major shareholders; Rabo Development B.V, a subsidiary of Rabo bank of Netherlands took up a 27.54% stake and the Norwegian Investment Fund for Developing Countries (NORFUND) took 27.54% shares from its previous 10.06% shares.

 

 It has emerged as one of the biggest single transaction in the history of the Uganda Securities Exchange (USE).

 

The Commonwealth Development Corporation (CDC), the company’s previous majority shareholder then holding 60.02%, divested some of its shares after receipt of the required regulatory approvals.

 

The bank retained significant shareholders such as CDC with 15% and NSSF with 6%.

On the trading floor on Tuesday, Umeme took the lion’s portion, selling 218,361 shares and picking over sh81.9m in turnover. 

 

This represented 92% of market activity.  Total market turnover was sh89m after a total of 451,443 shares were sold. Only three companies traded on the day. 

 

Stanbic Bank was the second big mover, pushing through 216,553 shares to realise sh6.5m in turnover. But Stanbic, Uganda’s most liquid company, continued to post the biggest interest among potential investors in the final days to its dividend day.

 

There were bids for over 20 million Stanbic shares that were not matched with the offer of only six million shares.

Uganda Clays, which is enjoying resurgence and much optimism sold 16,529 shares, realising sh578,515.