After paying a massive $130m (Frw70.6 b) now the Rwandan investors are only to receive shares worth $26m (Frw14.2 b) Safaricom, a Kenya telecommunication company.

This is far less than half of what their interests were in East Africa’s most profitable company.

Simon Peter Karenzi, Chief Executive Officer of Dyer and Blair Securities Rwanda, a subsidiary of Dyer and Blair Investment Bank said the refund started last week.

The bank prepared Safaricom for its Initial Public Offer (IPO) which ended on May 31 when the results of share allotment were announced.

Trading on the secondary market commenced on June 9, the same day that brokerage firms were supposed to start repaying balances to their clients.

For the case of Rwanda investors, Karenzi said that the delayed refund was caused by over subscription which in turn created delays in processing of cheques.

Some investors had provided different accounts on which the funds would be drawn upon. Karenzi said the process of reconciling the two accounts also caused delays in refund.

"Institutional investor paid after knowing what was allotted to them. Some investors who have accounts in the receiving bank (City Bank) have received their money,” Karenzi said.   

Because Safaricom was oversubscribed by over 600 per cent, each investor was given only 21 per cent of what they had applied for, leaving vast sums of money to be returned to investors while institutional investors were given 31 per cent of what they applied for.

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