Airtel Africa, as part of its share buyback plan initiated in February 2024, has repurchased 8.6 million ordinary shares from Citigroup Global Markets Limited. The primary objective of this program, as stated by the second largest mobile network operator in Nigeria, is to trim down its share capital, consequently alleviating Airtel’s debt obligations and the escalating costs of its operations, which have experienced a recent surge. Segun Ogunsanya, the CEO of Airtel Africa, underscores that the company’s businesses have been generating significant cash, prompting the board’s decision to launch the share buyback initiative. Ogunsanya emphasizes that the board perceives the repurchase of its shares as a compelling employment of its capital, especially considering the Group’s robust long-term growth prospects.
The share buyback program commenced on March 1, 2024, aiming to repurchase $100 million worth of the company’s shares within a 12-month period. This program is segmented into two tranches, with the first tranche amounting to $50 million, set to run for 7 months, spanning from March to August 2024.
In the latest transaction between Airtel and Citigroup, the company repurchased 487,985 ordinary shares at a weighted average price of £103.94 ($131.70) per share.
Airtel Africa has grappled with profitability challenges, primarily stemming from macroeconomic difficulties in Nigeria, its largest market on the continent. The company’s financial statements reveal a 21.96% decline in revenue to $1.24 billion in December 2023 from $1.59 billion, attributed to the depreciation of the naira affecting Airtel’s conversion rates. To mitigate its high operating costs, Airtel has recently outsourced a significant portion of its tower operations to IHS Towers. Additionally, the share buyback program serves as a mechanism for the company to curtail its debt obligations while exploring other avenues to sustain profitability amidst these challenges.
