The operator’s shares began trading on Euronext Brussels last Monday at an offer price of 24.50 euros ($29.86). The IPO raised as much as 3.59bn euros ($4.36bn), valuing the operator at about 8.6bn euros ($10.46bn). The offering was Europe’s biggest IPO since France Telecom sold a 6.3bn euro ($7.66bn) stake in Orange in 2001.

Belgacom’s generous dividend policy undoubtedly drew many of the investors to the oversubscribed offering. In early March, chief executive Didier Bellens revealed that it planned to pay 50% to 60% of its net income in dividends. According to the company, it will pay 395m euros ($477m) in dividends for 2003. Belgacom also has one of strongest balance sheets of any European telco, with only 482m euros ($581.8m) of debt.

Belgacom never took part in the spending and acquisition spree like many of its European rivals, and avoided the high fees for third-generation mobile phone licenses (Belgium held 3G auctions for the licenses after the boom period). Consequently, it gained a reputation as a slow-moving operator.

The Belgian government still maintains a controlling stake in the carrier, with a 51.6% share, although it may reduce this to the legal minimum of 50% plus one share at a later stage. The 48.4% shares that were sold in the IPO mostly belonged to a consortium made up of SBC Communications Inc, Singapore Telecommunications Ltd, and Denmark’s TDC.

The three telecom operators had been shareholders in Belgacom since 1995, when they paid $2.46bn to take a share of the privatized state monopoly. SingTel revealed that it should reap a net gain of SGD 900m ($532.7m) to SGD 950m ($562.1m) from the sale of its stake.

The sale has also provided some welcome cash for SBC Communications, to help its mobile phone joint venture (Cingular Wireless), pay the heavy $41bn cash price for AT&T Wireless Services Inc.

Belgacom offers fixed-line phone and internet services in Belgium as well as mobile phone services through its mobile unit Proximus, in which it holds 75% stake.

Proximus is the country’s largest mobile operator, and has more than 4 million users. During 2003, revenue grew although it lost market share to rivals France Telecom’s Mobistar and Royal KPN’s BASE. About 80% of Belgium’s 10 million people own a mobile phone.

Historically, Belgacom traces its roots to RTT, a company formed in 1930 by the government to offer the country telegraphy services. It changed its name to Belgacom in 1991.

This article is based on material originally published by ComputerWire