MTN raises GH¢1.1bn in IPO…misses mark by 67%

MTN was able to raise only GH¢1.15billion out of the expected GH¢3.48billion from its Initial Public Offering which lasted from May 29, 2018 to July 31, 2018.

Even though the share sale exceeded the minimum of GH¢348million or 10 percent of the total required for the offer to be declared successful, it still represented only 32.97 percent of the offer.

MTN’s shares proceed is three times larger than the previous biggest IPO in Ghana, when Agricultural Development Bank (ADB) raised GH¢326million in December 2016, even though the telecoms giant was unable to sell all of its shares.

MTN made available up to 4.64 billion ordinary shares valued at GH¢3.48billion at an offer price of GH¢0.75 per share, representing up to 35 percent. IC Securities acted as financial adviser and sponsoring broker to MTN Ghana in respect of the transaction.

The first day of trading the MTN Ghana shares is expected to be 5 September, 2018. Shareholders will be able to monitor and trade their MTN Ghana shares by contacting a licenced dealing member of the Ghana Stock Exchange.

Chief Executive Officer of MTN Ghana, Selorm Adadevoh, announcing the IPO results to journalists in Accra described the transaction as “a historic success”, and one that serves as the centre-piece of company’s localisation efforts.

“This transaction has enabled Ghanaians from all walks of life to own a share in one of Ghana’s largest, most visible and respected companies.

“As it stands, we are the company with the largest number of Ghanaian shareholders among all listed companies on the GSE. Also, the result is double the size of all IPOs put together in the history of the GSE,” he said.

He added: “We are happy to attract foreign investors as well; this is an indication of the Ghana stock market’s attractiveness”.

The transaction serves as the centrepiece of MTN Ghana’s localisation effort and demonstrates its long-term commitment to Ghana.

By raising GH¢1,146,589,465 from 128,152 applicants, the offer makes history as the largest primary share offer in the history of the Ghana Stock Exchange and enables many Ghanaians from all walks of life to own a share in one of Ghana’s largest, most visible and well-respected companies.

Out of the total amount raised, 499 institutional investors bought GH¢1.03billion, representing 89.44 percent while 127,653 retail applicants bought GH¢121.1million, representing 10.56 percent of the amount raised.

Also, 108,434 applicants subscribed through the MTN Mobile Money portal, representing 84.6 percent of applicants.

According to the MTN Ghana boss, the high numbers demonstrate another usage area for mobile money and further makes a strong case for financial inclusion.

He added: “The multiple channels that were used to promote the IPO, as well as other means of purchase – MoMo, digital and other means of transaction in addition to market storms and engagements with stakeholder groups across the board – largely contributed to its success”.

Out of the 128,152 applicants, 127,826 were Ghanaians – but they could raise only GH¢443.63million, representing 38.69 percent. This means 326 non-Ghanaians bought GH¢703million worth of shares, representing 61.31 percent.

A statement from the local bourse said all successful applicants will be allotted all the shares they applied for on September 4, 2018.

“Applicants with Central Securities Depository (CSD) accounts will have their CSD accounts credited with their allotment by September 4, 2018 by 5:00pm. IC Securities will create CSD accounts for successful applicants who did not provide details of their CSD accounts as part of their application, and their respective allotments will be credited to the respective CSD account created for them.”

 

Thebftonline.com

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