10 December 2021

Namibia’s state-owned Mobile Telecommunications (MTC) has raised N$2.5bn (US$168m) from the sale of 49% of its shares on the Namibian Stock Exchange (NSX).

On September 20, when the company’s 367,500,000 ordinary shares were officially put up for sale at N$8.50 each, the government said it wanted to raise N$3,123,750,000 (US$210m).

Local newspaper The Namibian said of the 367.5 million shares offered for sale, more than 299 million were purchased while 68.5 million did not find buyers. Some 5,611 individuals, companies and institutions took part in the IPO of MTC, which only reached its target by 81%. The majority of the offer was taken up by institutional investors, who raised N$2.4bn, while retail investors only raised N$137.2m.

A number of financial analysts believe that the telecom operator has done well in the current difficult economic environment, which has been hit by the Covid-19 pandemic, while others believe that it was a failure compared to previous IPOs and that more time should have been allowed for the transaction to reach the government’s target amount.

Funds obtained from the sale of the 49% of the capital of MTC will help support public finances severely affected last year by Covid-19. In March 2021, finance minister Ipumbu Shiimi indicated that government revenue was expected to decline by 6.1% or N$3.4bn in fiscal 2021/22 compared to the previous fiscal year.