Last week, during the presentation of the 2019/2020 financial results of the Mobile Telecommunications Company (MTC), the Namibian Minister of Public Enterprises, Leon Jooste, confirmed the government’s willingness to open the capital of the public enterprise to the Namibian Stock Exchange (NSX) by the end of October 2021. However, aware that the current economic context, marked by Covid-19, presents high risks for investments, the telecoms regulator has given the incumbent operator telecommunications 20 months to get in order.
It was in May 2019 that MTC launched its IPO process. The whole operation was to be closed in July 2020. But the restrictions induced by Covid-19 have “ had an impact on the financial markets, reduced investor appetite and blocked the engagement program for local and cross-border investors. To ensure a successful listing that enables MTC to meet its goals of a broader shareholder base, including a large Namibian stake in MTC, and an acceptable return for our current shareholder [Namibia Post and Telecom Holdings (NPTH) Ltd, Editor’s note] , MTC has been authorized to postpone the listing until September 2022 at the latest, ”said Theofelus Mberirua, President of MTC.
Over the past five years, MTC’s income has remained positive. It rose from 2,324 million Namibian dollars (156 million USD) in 2016 to 2,683 million in 2020. The government which is aware of this constant growth wants an opening of the capital of MTC in order to allow local investors to also profit the telecommunications sector, whose financial health is expected to strengthen over the next few years with the strong demand for broadband connectivity that is currently emerging.
MTC’s capital opening will also allow the company to raise enough funds to accelerate its network investments that will support the country’s digital transformation. The telecoms company is currently leading the 081Every1 project intended to cover 100% of the national territory with high-speed telecom services.
Source: Agence Ecofin