Uganda: NIC to Be Fully Privatised
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New Vision (Kampala)
3 July 2008
Posted to the web 4 July 2008
Ibrahim Kasita
Kampala
THE long-awaited sale of the Government's 40% stake in the National Insurance Corporation (NIC) on the stock exchange is expected to be finalised by August, the Privatisation Unit's public relations officer, Jim Mugunga, has said.
The process of selling the Government's shares in NIC has dragged on since divesting the company to Nigeria-based Industrial and General Insurance Company (IGI) in June 2005. IGI paid over $3.625m (about sh6.2b) for a 60% stake in the insurance giant.
"We appointed transaction advisors. They are preparing documents to be submitted to the Capital Markets Authority," Mugunga said.
"Preparations are in advanced stages and if all things go well, we are targeting August for the listing."
Josephine Omunyidde, the NIC publicist, said: "I don't want to say yes or no but for sure, it will not be later than this year."
The company is preparing a prospectus for investors. The Merchant Bank of East Africa (MBEA), Data Bank of Ghana and Dyer and Blair are the transaction advisers.
The listing will bring to seven the number of local companies on the Uganda Securities Exchange and to 10 including cross-listings from the Nairobi Stock Exchange.
NIC is listed in Class III of the Public Enterprise Reform and Divestiture Act. This means the Government is obliged to divest all its shares.
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It was established in 1964 and had assets worth more than sh26b in 2004. The IPO comes amid growing competition in Uganda's insurance sector brought about by the entry into the market of foreign firms.
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