National Insurance Corporation Ltd (NIC) Uganda IPO…

NIC Uganda is a leading provider of insurance and risk management services in Uganda.
Established by an Act of Parliament in 1964 with the Govt of Uganda holding 100% of the shares.

In June 2005, the Govt of Uganda divested 60% of its shares in NIC to Industrial and General Insurance Company Limited (IGI) of Nigeria. IGI along with its partners formed an investment vehicle Corporate Holdings Ltd to take up the offer. The shareholding of Corporate Holdings comprises 85% IGI, while 15% belongs to a local Ugandan businessman Patrick Bitature and Erik van Veen a South African employed by MTN and paid over Shs 6.2bn (around $ 3.625M) for the 60% stake.

IGI is a privately-owned Nigerian Insurer and claims to be the largest privately owned insurance company in West Africa.

The Govt of Uganda retained a 40% interest in NIC which is to be listed as it fully divests from this entity. Part of this stake will be sold to NIC staff through a share ownership scheme.
NIC Uganda is listed in Class III of the Public Enterprise Reform and Divestiture Act. And in line with the Ugandan government’s policy of privatisation implemented in 1993, this firm should be fully divested as its considered non-core to Govt activities.

After the sale of NIC to IGI an agreement was signed in June 2005. For the government to divest the remaining 40% shareholding by way of IPO within the next 18 months. Which is yet to happen 4 years later. This IPO has been postponed numerous times, with the most recent being July 2009 after it emerged that the Uganda Securities Exchange has not yet approved NIC’s application.

The Merchant Bank of East Africa (MBEA) Uganda and Databank of Ghana are the lead transaction brokers for this NIC listing, if it eventually takes place.

More articles on this listing. UNAA Times and New Vision Ug.