The recently established Ethiopian Securities Exchange (ESX) has realised its initial capital raise target of $11.07 million (Ksh1.45 billion) needed to fund the start of operations.
The exchange said the cash raise was oversubscribed by more than two times, receiving offers of $26.6 million (Ksh3.49 billion) in new capital, although it did not state the amount it was taking up from the offers.
The exchange tapped the capital from 48 domestic and foreign commercial investors, having held roadshows in Addis Ababa, Nairobi, and London to market the cash raise.
The Ethiopian finance ministry, EIH and FSD Africa signed a cooperation agreement in May 2022 to set up the stock exchange.
The exchange was subsequently established in October 2023 as a public private partnership, where 25 percent is held by the government’s strategic investment arm Ethiopian Investment Holdings (EIH) and its subsidiaries such as Ethiotelecom and the Commercial Bank of Ethiopia.
The remaining 75 percent is earmarked for private sector investors, led by Nairobi-based FSD Africa, the Trade and Development Bank (TDB) and the Nigeria Exchange Group (NGX).
Others include 16 domestic private commercial banks, 12 private insurance companies, as well as 17 other private domestic investors.
“Strategic foreign investments by TDB, FSD Africa, and NGX Group are particularly important in allowing the transfer of technical knowhow and best practices as well as other areas of long-term strategic value that we will explore,” the exchange said in a statement.
Ethiopia is currently the biggest African economy without a stock exchange, but has earmarked the establishment of the bourse as a key plank in its efforts to open up its economy to foreign investment, and a platform for privatisation of its state owned enterprises.
source- The East African
