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Indian billionaire Sunil Mittal is set to receive about $89 million from Airtel Africa’s interim dividend, after the telecom group fixed its payment rates and launched a fresh tranche of its share buyback program.
Airtel Africa will pay an interim dividend of 3.1 US cents per share, up 9.2% from a year earlier, on Dec. 11, according to Nairametrics. Shareholders on the register at the close of business on Nov. 13 will qualify.
The company fixed the naira exchange rate at N1,347.44 to the dollar, implying a payout of about N41.77 per share for holders on the Nigerian Exchange. That rate is about 7.5% below the N1,456 used for last year’s interim dividend, reflecting the naira’s recovery. London shareholders will receive about 2.31 pence per share.
The last day to trade with the dividend entitlement is Nov. 12 on the NGX and Nov. 11 on the London Stock Exchange. Shareholders have until Nov. 23 to choose their payment currency.
Mittal controls about 79% of Airtel Africa through Bharti Airtel and related entities, after completing a $2.9 billion share swap in June. With roughly 3.65 billion shares in issue, the dividend amounts to about $113 million in total, of which Mittal’s stake would receive about $89 million.
Meanwhile, Airtel Africa has started a new tranche of its share buyback. The company will repurchase up to 12.03 million shares, or 0.33% of its issued capital, by Dec. 22, with Citigroup acting as broker. All shares bought back will be canceled, and the tranche will not include purchases on the Nigerian Exchange.
The new tranche continues a $110 million program the company announced in May. Its first tranche, run by Barclays, was completed on Sept. 28, after Airtel Africa bought back about 19.9 million shares at an average price of 336.05 pence each.
Buybacks reduce the number of shares in circulation, which gradually increases the stake of remaining shareholders, including Mittal, without requiring him to buy more shares.
The payout follows strong half-year results. Airtel Africa’s profit rose 20.5% to $452 million in the six months to September, while basic earnings per share climbed to 10.2 cents from 8.3 cents.
The returns come during a busy year for Mittal’s African business. Airtel Money, the group’s mobile money unit, completed a £5.3 billion London listing in October and has said it will look for acquisitions across the continent. Mittal also received France’s highest honor last month.
As a result, Airtel Africa remains one of Mittal’s most valuable assets, combining rising profits with steady cash returns to shareholders.
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