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Ethio Telecom Launches 100 million Shares to the Public

October 16, 2024 — In a groundbreaking development for Ethiopia’s capital market, Ethio Telecom, previously a fully state-owned entity, has unveiled 100 million ordinary shares in the country's first initial public offering (IPO). This highly anticipated event was officially launched by Prime Minister Dr. Abiy Ahmed.

The shares are priced at 300 birr each, with a minimum purchase requirement of 33 shares (totaling 9,900 birr) and a maximum of 3,333 shares (999,900 birr). Buyers should also be aware that a 1.5% service fee and value-added tax will apply. The share sale is open from October 16, 2024, until January 3, 2025.

Investors interested in becoming shareholders must meet specific criteria: they must be Ethiopian citizens, register on the designated platform, provide valid identification, and be users of the telebirr SuperApp. Additionally, if applying on behalf of someone else, a legal power of attorney is required. After reviewing the company's prospectus, applicants must complete the purchase application and finalize payment within 48 hours.

Ethio Telecom aims to enhance investor confidence by facilitating secure and transparent trading. Once the shares are listed on the Ethiopian Securities Exchange (ESX), investors will be able to trade them in a regulated environment. Notably, Ethio Telecom’s shares are not expected to be immediately available on the ESX trading platform; instead, they must first be subscribed to by investors.

With a subscriber base of 79 million and 50 million mobile money users, Ethio Telecom is setting ambitious revenue targets, aiming for a 75% increase to reach 163.7 billion birr (approximately $1.1 billion) by 2024/25. Last year, the operator generated 93 billion birr in revenue.

The move to sell shares to local investors follows the government’s previous attempts to sell a larger stake in Ethio Telecom, which faced challenges due to economic conditions. In June 2021, Ethiopia initiated the tendering process for a 40% stake, which was postponed in March 2022 and later revived.

The National Bank of Ethiopia (NBE) recently revised its Payment Instrument Issuer Directive, enabling mobile money platforms to facilitate investments in securities. This revision has opened the door for a more inclusive approach to investment, aligning with the country’s broader capital market development goals.

In a statement, the Ethiopian Securities Exchange noted, “While Ethio Telecom’s primary offering is fully dedicated to retail investors, we anticipate a growing role for institutional investors as our capital markets develop.”

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Ethio Telecom Launches 100 million Shares to the Public

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