Interswitch plans IPO in London, Lagos next year

Interswitch Limited is considering initial public offerings in London and Lagos next year as it plans an expansion into new African markets, its Chief Executive Officer, Mr. Mitchell Elegbe, has said.

The company processes payments for banks and owns a brand of debit cards in Nigeria

Elegbe said the organisation had discussed share sales with banks including Bank of America Corporation, Barclays Plc and Standard Bank Group Limited and might choose advisers for a transaction within a few months.

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“We’re looking at doing an IPO,” Elegbe, 43, who founded Interswitch in 2002, told Bloomberg in an interview in Lagos.

“We’re looking at the UK and Nigeria. Our industry is one that investors love; they understand it, especially in places like the UK,” he added.

Interswitch, which operates in five African countries and owns Verve, a Nigerian provider of debit cards, would be the second company from Nigeria to sell ordinary shares in both London and Lagos after Seplat Petroleum Development Company’s dual listing in April last year.

The London Stock Exchange has more than 120 listed African companies and expects about five Nigerian offerings over the next year, according to the co-Head of Emerging-Primary Markets, Mr. Ibukun Adebayo.

The Nigerian Stock Exchange All Share Index has gained 14 per cent over the past three months after falling 16 per cent last year before elections and as sliding oil prices hit the economy.

Interswitch is about 70 per cent-held by London-based private equity group, Helios Investment Partners; South Africa’s Adlevo Capital Managers; and the International Finance Corporation, according to Elegbe.

Helios bought 52 per cent of Interswitch for $96m in December 2010, according to its website.

Interswitch has grown rapidly since then amid a proliferation of automated teller-machines and point of sale devices in Nigeria and it may look to use any capital it raises to fund further expansion, Elegbe said, declining to disclose the company’s revenues or profits.

“We’re a very liquid company,” he said. “But that’s not to say that if we go to the stock exchange we can’t achieve things a lot faster and on a bigger scale.”