Airtel Africa Embarks on Share Buyback to Optimize Capital Structure


Airtel Africa, the second-largest mobile network operator in Nigeria, has announced a significant move to buy back 8.6 million ordinary shares from Citigroup Global Markets Limited. This decision is part of a broader share buyback plan that the company initiated in February 2024.

The primary objective of this buyback program is to reduce Airtel Africa’s share capital, which in turn will help lower the company’s debt obligations and operational costs. Segun Ogunsanya, the CEO of Airtel Africa, highlighted that the company’s businesses have generated substantial cash flow, prompting the board’s decision to launch this share repurchase initiative.

“The board believes that repurchasing its shares is an attractive use of its capital in light of the Group’s strong long-term growth outlook,” said Segun Ogunsanya.

The buyback program is set to run for 12 months, with the first tranche of $50 million worth of share repurchases spanning from March to August 2024. The latest transaction with Citigroup involves the repurchase of 487,985 ordinary shares at a weighted average price of £103.94 ($131.70) per share.

Airtel Africa has faced challenges in maintaining profitability due to macroeconomic factors, particularly in its largest market, Nigeria. The company’s financial statement for December 2023 showed a 21.96% drop in revenue, from $1.59 billion to $1.24 billion, which was largely attributed to the decline in the value of the Nigerian naira and its impact on Airtel’s conversion rates.

To address these challenges, Airtel Africa has taken steps to reduce its high operating costs, including outsourcing a significant portion of its tower operations to IHS Towers. The share buyback program is another strategic move by the company to optimize its capital structure and maintain profitability.

By reducing its share capital and debt obligations, Airtel Africa aims to strengthen its financial position and enhance its long-term growth prospects. This bold initiative reflects the company’s commitment to adapting to the evolving market conditions and exploring innovative ways to create value for its shareholders.



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