Airtel Africa shares fell as much as 15 percent on Friday after its London stock market debut, hitting a low of 67 pence (about Sh87) against an initial public offering price of 80 pence.
It was trading at 70.5 pence (about Sh91.56) at 09.15 GMT.
The company, a unit of India’s Bharti Airtel Ltd, set a range of 80 to 100 pence (about Sh103.0 to Sh129.87) per share the week before for its IPO, before pricing at the bottom of the spread.
The final offer comprised 744 million new shares, setting the deal size at 595 million pounds (about Sh77.3 billion) and the initial market capitalisation at about 3.1 billion pounds (about Sh403 billion) at issue, the company said.
“It does show the market is tricky,” said a person close to the transaction. “(But) this is day one.”
Parent Bharti Airtel also dipped after its listing before its market capitalisation increased substantially, he said.
Airtel Africa operates across Africa in 14 countries, and will simultaneously list on the London and Nigeria Stock Exchanges.
According to its prospectus, its shares will start trading on West African country’s bourse on July 4.
Its local subsidiary, Airtel Kenya, is set to merge with Telkom Kenya after signing a binding agreement to merge their mobile, enterprise, and carrier services to form a single joint venture company.
The merged company will be chaired by Telkom chief executive Mugo Kibati while Airtel Kenya chief executive Prasanta Sarma will be appointed chief executive officer of the entity to be named Airtel-Telkom.