CiplaQCi, a Ugandan pharmaceutical manufacturing company has started its journey towards listing on the Uganda Securities Exchange. This was revealed through a 129 paged prospectus [PDF] which also detailed the company's operations, financial performance, management team and expansion plans.
The prospectus points out that CiplaQCi has a share capital of UGx. 45,648,865,000 (roughly $12.5 Million) and looking to sell to the public 657,179,319 shares of the 3,651,909,200 total issued shares at UGx. 12.5 ($0.0034) par value. That, according to the prospectus, translates into 18% stake of the company.
The offer will open on 13 August 2018 and close on 24 August 2018.
The company has set up a couple of advisors for the IPO including; Renaissance Capital, Crested Capital, Bowmans Uganda, Ernest & Young, Standard Chartered Bank, and C&R Group.
Umeme was the last local company to list on Uganda Securities in 2012 followed by Kenya's Uchumi in 2013. CiplaQCi, therefore, will become the first company to list in the past 5 years. This will also make it the 9th local company as well as the 17th company on the exchange.
CiplaQCi is controlled by Mauritius based Meditab Holdings Ltd which owns 51.05% stake. The other current shareholders include UK's Cipla EU (11.25%), the three Ugandan founders who own 3.6% each, Mauritius' registered CapitalWorks and Amistad with 14.4% and 12.5% respectively.
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However, India's Cipla Limited ultimately controls the company with 62.3% given it owns both Meditab Holdings Ltd and Cipla EU.
The pharmaceutical company has previously raised Private Equity investment as well as struck strategic partnerships and investments. That was from PE funds CapitalWorks and TLG Capital as well as Cipla EU, an arm of Cipla Limited.
These, especially the PE funds, could be the ones forcing through the IPO as they seek to exit from the company that was founded 13 years ago. Given the prospectus lists them as the selling shareholders together with some Ugandan founders of the company.
Emma Katongole, CiplaQCi's founder, and current Executive Chairman, also pointed out that "this offer is a sale of shares by the selling shareholders."
Adding that, otherwise, the company can continue self-financing both its immediate and future plans.
"The Company is well capitalized, is cash generative and has sufficient resources to self-fund its growth and, as such, does not anticipate the need to raise any primary capital at this time," Emmanuel pointed out in the statement.
There haven't been much opportunities for technology investors across Africa to exit in form of IPOs. Therefore, although not a technology company, this is an opportunity for any tech founders and investors who are looking to take the same route to watch how everything unfolds.
CiplaQCi was founded after Cipla acquired a majority stake in Quality Chemicals which was founded in 1997.