KAMPALA, Aug 29 (Reuters) – Airtel Uganda aims to raise 800 billion Ugandan shillings ($216 million) by selling a 20% stake to drive its expansion plans, the telecommunications firm said on Tuesday, as it announced details of its initial public offering (IPO).

When the listing completes, Airtel Uganda will be the second listed telecoms company on Uganda’s stock exchange after MTN Uganda MTNU.UG, majority owned by South Africa’s MTN Group MTNJ.J, which listed in December 2021.

Airtel Uganda is a unit of India’s Bharti Airtel BRTI.NS.

Airtel Uganda Managing Director Manoj Murali told a news conference that the offer of 8 billion shares would start immediately and close on Oct. 13.

The results of the IPO will be announced on Oct. 30, and the shares listed on the Uganda Securities Exchange on Oct. 31, according to a prospectus.

The IPO’s objective is “establish a source of future capital to support its (Airtel Uganda’s) extensive growth strategy,” the prospectus said.

Airtel Uganda expects to pay dividends of 500 billion Ugandan shillings in 2023 and will target a dividend payout ratio of 95% of retained earnings or net profit after tax, whichever is higher.

The company made a pretax profit of 474 billion Ugandan shillings in calendar year 2022, down from 565 billion Ugandan shillings the previous year. It said its revenue is forecast to grow 16.6% year on year in 2023.

($1 = 3,705.0000 Ugandan shillings)

(Reporting by Elias Biryabarema; Writing by George Obulutsa and Hereward Holland; Editing by Alexander Winning and Mark Potter)