Does Airtel Money mark the end of London’s listing drought? Not yet | Nils Pratley

A win is a win, but we should probably contain our excitement about the biggest flotation in London for five years. Airtel Money, a payments processor that operates in 13 African countries and should be worth between £6bn and £7bn, is a welcome addition to the stock market but it would be a stretch to say the event marks a definitive change in the weather to end the listings drought.

Why? Because, in a sense, Airtel Money is already here. It is a 78%-owned subsidiary of Airtel Africa, an established FTSE 100 firm with a market value of £11.3bn ultimately controlled by Bharti Enterprises under the Indian billionaire Sunil Bharti Mittal, also known for his 25% stake in BT.

That means this was a home fixture for London in the competition with other venues. The Airtel/Bharti collective still had a look at the Middle East, the US and the rest of Europe, we’re told, but London will have started as a heavy favourite. It is simply easier to spin off a subsidiary on a market where the parent is already known – and, indeed, a market where Airtel Africa was a top-performing Footsie stock last year.

Ian Ferrao, the chief executive of Airtel Money, still made all the right noises to please exchange officials. London got the nod on account of its deep capital pools plus investors’ enthusiasm for fintech firms and their general understanding of African companies, he said. All true, but it’s also the case that it would have been simply odd to list Airtel Money on a different market to Airtel Africa.

The latter is likely to remain the largest shareholder for years yet, and the two businesses are closely linked operationally. Airtel Money has grown out of Airtel Africa’s telecoms business, and one of its key growth opportunities is to persuade even more of the telephony customers to join the payments service. There are 75 million potential recruits to go at, on top of the established 53 million monthly active users, so there is a decent story to tell.

It is one reason why the listing should go well, assuming the wider stock market environment remains calm. Airtel Money is capital-lite, converts a chunky proportion of its earnings into cash, carries the buzzy fintech vibe and is growing at about 20% a year. The cash-generative qualities mean no new equity is being raised, so it is really an opportunity for existing shareholders – including minority owners including TPG, ​Mastercard, the Qatar Investment Authority and Chimetech Holding – to cash in a few chips. As long as they don’t get greedy on price, it looks a relatively easy pitch for the promoters.

For London, the listings game is really about winning a few high-profile names where the competition from overseas markets is tougher. The biggie remains Norway’s Visma, one of Europe’s biggest software companies. A listing was delayed earlier this year because of the so-called “Claude crash” – the sell-off in data-related sectors deemed to be under threat from AI tools – but private equity-backed Visma remains a top target given its valuation a year ago was put at almost €20bn (£17.2bn).

The listing venue for Visma looks to be a shootout between London, Stockholm and Amsterdam. Win that one and it may be time to turn more cheerful about the UK’s pulling power. We’re not there yet.