Ghana, the largest telecom operator in Ghana opened a historic Initial
Public Offering (IPO) in the country that will see it raise as much as
US$743 million in fresh capital or an equivalent of N264 billion. The
IPO is the largest ever undertaken by the country and if successful
could set the stage for other companies to test the market.
offer is being keenly watched by operators in the Nigerian capital
market because its success could open room for Nigerian firms to look to
the West African neighbour for their capital needs considering the
dearth of IPOs in the Nigerian capital market, a situation that is
expected to be remedied with an expected similar MTN Nigeria IPO later
in the year.
MTN Ghana IPO is also unique in that it is the first ever IPO globally
on any stock exchange in which shares can be purchased through mobile
money. This is being facilitated through the MTN Momo Wallet, a mobile
money platform popular in Ghana where Telecom operators have been
allowed to lead the mobile money revolution. This is unlike Nigeria,
where mobile money platforms have failed to pick up largely because it
is still a bank led model.
the MTN Ghana IPO, all an investor has to do to buy units of the shares
on offer is to ‘Dial *170 Hash” and follow the required instructions,
and he will be able to purchase as many shares as he can afford with the
cash stashed away on his MTN Momo Wallet. It is a unique mode of IPO
that has ‘democratised’ the share offering process, a factor that would
likely make the offer highly successful, say analysts.
offer is open for nine weeks starting May 29 and closes on 31 July
2018. The MTN Ghana IPO is a pre-condition given to it by Ghanaian
telecom regulators for the company’s acquisition of the 4GLite license.
licence allows MTN Ghana to offer 4G LTE mobile internet services to
its customers and is expected to improve the Company’s ability to offer
its customers a high-speed data network and advance its competitive
position in the market.
launch reaffirms our commitment to Ghana and this fills us with a great
sense of optimism,” Ebenezer Asante, CEO of MTN Ghana said.
Offer comprises 4.6 billion ordinary shares representing 35 percent of
MTN Ghana’s issued shares post Offer. However, up to 2.5 billion of the
Shares will be new MTN Ghana Shares to be issued by MTN Ghana to the
successful and qualifying applicants while another 2.2 billion Shares
are from existing shareholders who are selling their shareholding to
MTN Ghana IPO is being closely followed by the Nigerian investment
community because of the expected MTN Nigeria IPO, which is expected to
follow a similar pattern. In statement released to the media on May 28,
MTN Nigeria said that it is yet to set a date for the IPO but confirmed
that the IPO process will be concluded in 2018.
Awe, Executive Director at the NSE told BusinessDay recently that the
Exchange is also planning to ensure retail investors are able to
participate in the proposed MTN Nigeria IPO by subscribing to shares
through the use of their mobile phones.
disclosed that the exchange is working with the Nigerian Communication
Commission to enable investors use of Unstructured Supplementary Service
Data (USSD) to subscribe to the proposed MTN Nigeria IPO.
has expressed publicly an interest to list this year and what I can
tell you is that the exchange is able, willing and ready to list the
company this year. If MTN does not list, it will not be because of the
Nigerian stock exchange as we are working on an electronic IPO platform
that will ensure that the 150 million subscribers it has in the eco
space, actively participate in the MTN listing,” Awe said.
idea is basically to give retail investors, who were hurt in the mid
2000 market crash an opportunity to come back to the market.”
a market share of approximately 55.09 percent as at December 2017; MTN
Ghana is the market leader in Ghana’s increasingly competitive mobile
telecommunications industry, growing from a subscriber base of 8.7
million as at December 2010 to over 17.83 million as at December 2017.
Ghana is expected to have a market capitalisation of about 10-billion
cedi (N777 billion) post offer. The offer document shows that the firm
forecasting that its revenue for 2018 will hit GHC4-billion (N311
billion) but rise consistently to GHC5.4-billion (N420 billion) in 2020.
Ghana telecom firms net profit is expected to hit GHC 718-million
(N55.8 billion) in 2018, but will rise to more than GHC1-billion (N77
billion) in 2020.
Ghana stock Exchange has set the minimum amount to be raised for the
offer to be considered successful and for the listing to proceed at
GHC350-million (N27.2 billion) which represents about 10 percent of the
total offer size. Allocation to foreign investors have been capped at
five percent of the total shares on offer.
Group, Africa’s biggest mobile phone operator, and parent company to
both MTN Ghana and MTN Nigeria recorded 9.1 percent increase in its
revenue for the first quarter of 2018 ended March 31 due to growth in
Nigeria and Ghana, where voice revenue expanded.
MTN Group cited MTN Nigeria’s stronger-than-expected growth in revenue
as one of the major contributor that allowed the business to benefit
from increased scale. “Group voice revenue growth of 5.4 percent
benefited from strong growth in Nigeria and Ghana of 15.2 percent and
20.6 percent respectively. Group data revenue grew by 26.9 percent
quarter –on-quarter, as we executed on our dual-data strategy, ensuring
appropriate data coverage across our footprint,” Rob Shuter, MTN Group
MTN Group has 217 million subscribers in 22 countries in Africa and the
Middle East with operating subsidiaries and joint ventures in
Afghanistan, Benin, Botswana, Cameroon, Cyprus, Ghana, Guinea Bissau,
Guinea Republic, Iran, Ivory Coast, Liberia, Nigeria, Republic of Congo
(Congo Brazzaville), Rwanda, South Africa, Sudan, South Sudan,
Swaziland, Syria, Uganda, Yemen and Zambia.
DIPO OLADEHINDE & MICHEAL ANI