Bralirwa IPO; How to buy shares

Following the official launch of the Bralirwa Initial Public Offer (IPO) last week; that allows the general public to own a portion of the company, investors can now apply for the shares. The listing which represents 25 percent of government’s shares in the company is worth 128,570,000 shares which are being sold at Rwf 136 per share, since Tuesday this week until December 17th, this year. According to Andrew Otengo Owiny, the Executive Director of MBEA Brokerage Services, the process of application can be completed in less than 30 minutes if all the requirements are in place. “Anybody above 18 years of age can actually invest; what they need to do is go to licensed stock brokers or receiving banks, as well as stock brokers and banks that are part of the advisory team,” Owiny told Business Times in an interview last week. Investors hoping to buy a share will have to first fill in application form that requires them to fill in their identification and contact details. The minimum per application form which costs Rwf13, 600 is 100 shares. Owiny, who is also the lead transaction advisor of IPO, said that each application form must be accompanied by cash or a valid banker’s cheque for the full amount of payable for the offer shares applied for. According to the official, prospective investors are advised to read thoroughly the Prospectus (booklet) issued by the registrar of companies that is available through authorized selling agents and receiving banks. “It is very important to read it even people who are familiar with this process because it gives you all the information about the company (Bralirwa),”he advised. The application procedure involves filling a Central Securities Depository (CSD Form 1) form that allows the investor to open up an electronic account, into which their shares will be credited. “Shares will not be held in physical form, but will be held in electronic form in a shareholders CSD account. There is no fee for applying or opening CDS account, except bank charges for things like cheque books; if you come with cash it is totally free,”Owiny explained. Payment can be made by cash, bankers cheque, electronic funds transfer for non- residents and foreign applicants or bank guarantee. As proof of payment, the investor will be issued a receipt by the authorized selling agents or bank. Application forms can be accessed from licensed brokerage firms including MBEA, Dyer&Blair securities, African Alliance Rwanda, Continental Discount House, Dallas Securities and Faida Securities. This is in addition to receiving banks such as Kenya Commercial Bank (KCB) Rwanda, Commercial Bank of Rwanda (BCR) and Bank of Kigali. However, all commercial banks in the country are authorized to distribute the prospectus and application forms and to receive completed application forms and corresponding monies. While 35 percent will go to retailer investors from the domestic investors’ pool including other EAC citizens, incase of oversubscription in the retail sub-pool, Owiny said priority will be given to Rwandan citizens for up to 60 percent of the offer shares allocated. In case of oversubscription , all applicants that have not been allotted in full the number of offer shares applied for will be refunded an amount equivalent to the value of the offer shares not allotted . According to allotment policy, 70 percent of the offer has been reserved for domestic investors; while foreign investors were allocated 30 percent. This includes 35 percent for retailer investors, 5 percent to employees and distributors of Bralirwa, 15 percent for institutional investors from Rwanda and 15 percent to EAC institutional investors. According to the Prospectus announcement of the offer and risk allotment results will be made public on 18th January next year while shares will start trading on the Rwandan Stock Exchange on January 31. Ends