21 October 2024
The 10% initial public offering (IPO) of Ethio Telecom officially started on the Ethiopian Securities Exchange, the local stock exchange, on 16 October.
A total of 100 million ordinary shares are being made available to Ethiopians only. The share price is set at 300 birr. The minimum number of shares sold has been set at 33 for 9,900 birr while the maximum is 3,333 shares for 999,000 birr.
The IPO, launched by Prime Minister Abiy Ahmed, runs until 3 January 2025. Financial transactions will be conducted exclusively through the Telebirr superApp. In addition to the share price, any investor will have to pay a 1.5% service fee and value-added tax when purchasing a share and will not be able to purchase more than the specified maximum number of shares.
Ethio Telecom believes that this first public sale of shares in the country’s capital market and the offering to all Ethiopians of a stake in the country’s largest telecommunications and digital financial services provider will play a major role in expanding the sector’s role in the Ethiopian economy, improving the company’s efficiency, expanding its access to capital and continuously improving the quality and accessibility of its services.
This IPO marks the first step in the partial privatization process of Ethio Telecom, initiated by the Ethiopian government in June 2021 and then interrupted in March 2022 following economic difficulties. The process resumed at the end of 2022. The government had planned to open 45% of the company's capital to private investors. Moreover, to facilitate the entry of new shareholders, in preparation for this IPO, Ethio Telecom officially changed its status since June 21, 2024, in accordance with the Ethiopian Commercial Code. The operator has changed from a public company to a joint stock company.
The ordinary shares will be subject to a lock-up period, during which they may not be traded, sold, transferred or otherwise disposed of until the listing process on the Ethiopian Stock Exchange (ESX) is completed. Ethio Telecom’s official market capitalization has been set at 100 billion birr, according to the Addis Ababa Chamber of Commerce and Industry Associations (AACCSA).
