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SportPesa coy on IPO plan

NAIROBI, Kenya, Oct 18 – Betting firm Sportpesa is non-committal on claims that it plans to go public, as reported by Bloomberg Business.

The firm told Capital FM Business that, “as and when appropriate, the firm will communicate to stakeholders on the matter.”

“SportPesa is a privately-owned company and is constantly exploring opportunities that will create value for our stakeholders.”

The only issue the sports betting company says it is committed to is its customers and 300 employees.

Bloomberg had reported that Sportpesa had planned an initial public offering at the Nairobi Securities Exchange of its shares in the first quarter of 2019.

Sportpesa operates in Africa and the United Kingdom with an annual revenue of Sh100 billion, according to Bloomberg).

Analysts see the IPO as a great exit opportunity for Sportpesa investors who snapped up first-mover advantages in the Kenyan market.

“Additionally, the current market valuations would afford the firm ”cheap” access to expansion capital into the Africa region,” said Fred Gituthu, CFO of a local advisory firm.

“However, the current bear market should be of concern to the firm due to the low valuations.”

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At Sh100 billion in annual revenues Gituthu says the company would rank amongst the largest listed enterprises and perhaps provide the much needed market liquidity and diversity.

“However, the betting industry is built on choppy waters and the growth outlook fundamentals aren’t well anchored as the firm is potentially in its maturity stage for an investor looking at long-term value,” he added.

He further cautioned that an unsuccessful listing would dent the exchange’s credibility in vetting new market entrants.

“That said the NSE should be concerned about the betting industry’s volatile operating fundamentals from a regulatory standpoint and general societal misgivings about the industry,” Gituthu concluded.

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