Precision Air floats 58 million new shares

Kenyans have three weeks to own a piece of Tanzania’s largest airline, Precision Air, after the public sale began on Friday.

The airline, partly owned by Kenya Airways, has floated 58,841,750 new shares to the public at Tanzanian Sh475 per share, which translates to about Sh28 of the Kenyan currency.

The public sale is scheduled to close on October 28.

According to the prospectus of the planned share sale, Tanzanian investors will be allowed to buy 51 per cent stake in the airline and the remaining 49 per cent to be shared with foreigners.

This now gives an opportunity to Kenyans investors who have shown interest to enter regional stock exchanges but have faced entry barriers to the Dar es Salaam bourse.

The shares will be listed on the Dar es Salaam Stock Exchange on December 8.

The initial public sale will see Kenya Airways, currently holding 49 per cent and Tanzanian businessman, Mr Michael Shirima with 51 per cent stake, dilute their stake to 34.2 per cent and 34.6 per cent respectively.

The IPO had two false starts in 2010, in what management says were delays in getting approvals from the relevant regulatory bodies in Tanzania.

The airline’s group managing director, Mr Alfonse Kioko, said the proceeds from the IPO will be used to support its fleet expansion.

The airline reported Tsh 1.8 billion in net profits, which is about Sh112 million in Kenyan currency, in the year ended March 2011.

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