Ghana's ADB Said to Raise 450 Million Cedis in Initial Offering

  • ADB raises more than initial target of 400 million cedis
  • West African nation's first IPO sale in about two years

Agricultural Development Bank Ltd. raised 450 million cedis ($119 million), the largest initial public offering in Ghana’s history, last month, according to two people familiar with the deal.

The bank raised more than the target of almost 400 million cedis, said the people, who asked not to be identified because regulators are still reviewing the results. ADB will use 300 million cedis for capital and the rest to pay shareholders, including the nation’s central bank, which owns 48 percent. The government sold some of its 52 percent stake, one of the people said.

The IPO marks the end of eight months of wrangling in courts that ended up delaying the sale. The government and bank leadership got approval for the sale after shareholders and workers’ unions sought to block it. The bank funds farmers, processors and traders. The IPO was the first in Ghana in about two years.

Ghana has struggled to boost trading and lure companies to go public because of a lagging economy and trading volumes that have plunged. The economy of the world’s second-largest producer of cocoa expanded at the slowest pace in about 20 years in 2015 and inflation has remained above 15 percent in the past two years, curbing investor sentiment. Volume of stocks traded dropped to 4.3 million shares in March from 13.3 million a year earlier, according to data compiled by Bloomberg.

Ghana’s stock exchange index has dropped 5.8 percent this year, outperforming Nigeria’s main index, which has fallen 14 percent. Kenya’s has dropped 1.4 percent during the same period.

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