Safaricom shares debut, gain value

Safaricom shares started trading on the Nairobi Stock Exchange (NSE) with a 50 percent rise in value by the end of the trading day.

Shares closed the day at 7.50 Kenya shillings, up from 5 shillings during the Initial Public Offering (IPO).

Kenyan President Mwai Kibaki declared that the Safaricom share offer was the most attractive in Kenya's history and rang the bell to open trading. A total of 416 million shares were traded.

"This is more than 40 percent in earnings per share -- nowhere in the world can you expect such an appreciation in value on the first day of trading, which is very good for Safaricom, investors and the economy," said Mohammed Hassan, the managing director of Dyer and Blair Investment Bank, the lead transaction advisers.

Safaricom CEO Michael Joseph expressed confidence that share trading would soon help Kenyans who did not get what they applied for feel better about the IPO. Retail investors were allocated 21 percent of the shares applied for, due to oversubscription.

As expected, trading began on a high note, and it is anticipated that the share price by Friday will end up giving huge gains for shareholders and Kenya in general, Joseph said.

British firm Vodafone owns a 35 percent stake in the company.

The Safaricom offer will add another 200 billion shillings (US$3.1 billion) to the NSE, raising its total capitalization to more than 1 trillion shillings.