Sonatel proposes 10-for-1 stock split to increase accessibility

Sonatel has proposed a stock split during its upcoming assembly on October 8, aiming to transform each existing share into ten new shares. The operation, which is tentatively scheduled to take effect on October 26, is intended to change only the unit in which its capital is traded without altering the company's total market value.

Economist Gustavo Pessoa notes that while the split does not increase the total value held by shareholders or guarantee higher returns, it lowers the entry barrier for individual investors. By reducing the price per unit, the move allows smaller portfolios to invest more flexibly, providing an intermediate option for those who might otherwise choose to keep their savings in liquid cash rather than purchasing a single high-priced share.

However, the effectiveness of this move for small-scale savers depends heavily on transaction costs. For the split to truly promote broader participation on the BRVM, brokerage fees and order costs must remain low enough so that they do not absorb a disproportionate share of smaller investments.