Uzbek authorities have launched an IPO incentive program to raise $1 billion.
The Government and the Presidential Administration of Uzbekistan have launched a program to support private companies planning to go public by covering part of the costs of an IPO.
The Uzbek government has initiated a program to stimulate initial public offerings (IPOs) with the goal of raising $1 billion.
As Marius Dan, General Manager for Central Asia at Franklin Templeton, announced on August 24 at a panel discussion on capital and investment issues at the Silk Road Finance & Technology Forum in Tashkent, the government and the Presidential Administration of Uzbekistan have launched a program to support private companies planning to go public by covering part of the IPO costs.
**Target: $1 billion**
"The government and the Presidential Administration have announced a program to stimulate private companies to enter the market by covering part of the IPO costs, with the goal of raising $1 billion. I believe this is entirely achievable," Marius Dan stated.
According to him, the company shares this goal and is interested in attracting additional funding both for its own portfolio assets and for the development of the country's capital market as a whole.
**The impetus was the IPO of the National Investment Fund**
Marius Dan linked the launch of the program to the successful initial public offering of the Uzbekistan National Investment Fund (UzNIF), which took place in May of this year on the London and Tashkent Stock Exchanges.
According to him, the offering raised $692 million for the selling shareholder, the Ministry of Economy and Finance, against investor demand of $2.9 billion. Since the listing, the fund's shares have risen more than 50% and are currently trading at a premium of approximately 10% to net asset value (NAV) – a situation Marius Dan described as extremely rare for funds of this type, as such structures typically trade at or at a discount to NAV.
"This demonstrates a high level of confidence in the reforms the Uzbek government intends to implement over the next few years," he noted, adding that the success of the offering simultaneously raises expectations for both the government and the fund's management company.
Portfolio and Future Plans
Franklin Templeton manages a portfolio of 13 state-owned companies included in the fund, including SQB Bank, the national airline Uzbekistan Airways, railway infrastructure, and energy and utilities assets.
According to Marius Dan, all 13 companies transitioned this year to a governance model with a majority of independent members on their supervisory boards—a move he described as the foundation for the further transformation of state-owned assets.
Marius Dan stated that in the coming years, the company plans to list additional assets from the fund's portfolio, including SQB, the national airline, and telecommunications and hydropower businesses.
He believes the success of the initial public offering should also pave the way for private Uzbek companies interested in raising capital through a public offering to enter the market.