Ethio Telecom to sell 100 million shares for $2.54 each ahead of stock market listing
On Thursday, October 17, Ethio Telecom, Ethiopia’s state-owned telecom company, announced that it will sell 100 million shares at a price of 300 birr (about $2.54 each) using its mobile payment service.
The company’s CEO, Frehiwot Tamiru, shared this news as they prepare for a stock market listing. This initial offering will allow Ethiopians to purchase a 10% stake in the company. This is the first step toward the government selling an additional 45% stake to foreign investors.
Prime Minister Abiy Ahmed is working to attract more private investment in Ethiopia by launching a stock exchange next month and privatizing state-owned businesses. Brook Taye, CEO of Ethiopia Investment Holdings, confirmed that the sale of the initial 10% and the later 45% to private investors will move forward as planned. He also mentioned that the Ethiopian parliament is expected to pass new laws allowing foreign investors to enter the market within the next two to three months.
According to reports, Ethiopia is set to list this 10% stake in Ethio Telecom on the new stock exchange as part of broader economic reforms led by the Prime Minister. This move marks a significant change, allowing investors to own a part of the company, making Ethio Telecom the first firm to be listed on the Ethiopian stock exchange.
Ethio Telecom serves over 120 million people and has traditionally held a monopoly in Ethiopia’s telecom sector. However, in 2021, a consortium led by Kenya’s Safaricom entered the market after winning Ethiopia’s first privatized telecom license.
As of March 31, 2024, Safaricom reported that its customer base in Ethiopia had doubled to 4.4 million. In May, the company also received its first batch of 13 locally manufactured telecom towers to enhance its network.
In its 2023/24 fiscal year, Ethio Telecom reported an 8.9% increase in its subscriber base, reaching 78.3 million customers, along with a 21.7% rise in total revenue, reaching Birr 93.7 billion ($1.62 billion). This has resulted in a significant increase in net profit over the past six years.
Looking ahead, Ethio Telecom is targeting a 75% revenue boost this financial year and aims to grow its customer base by 6%, reaching 83 million users by maximizing its current services and introducing new digital and international offerings.
