It is offering 139.3 million shares in Telkom, which may be increased up to 167.1 million, to be priced between ZAR 33.50 ($3.88) and ZAR 40.90 ($4.73) per ordinary share. The government also announced that it aims to list Telkom on March 4, although the initial listing date had been set for February 25. Its shares will trade in South Africa and on the New York Stock Exchange.
Public Enterprises Minister Jeff Radebe said the application phase had to be extended in light of the unprecedented response to the general retail offering. He disclosed that more than 1.5 million South Africans had registered for the share offer, either via Khulisa (a discount program mostly for poor black South Africans with up to a 20% discount) or the general offer.
Based on total revenues and assets, the Johannesburg-based telco is the largest communications services provider on the African continent. It is currently 70% owned by the South African government, with the rest held by SBC Communications Inc and Telekom Malaysia Bhd. Its crown jewel is the 50% it owns in mobile operator Vodacom (Pty) Ltd.
Vodacom dominates the local mobile phone market with a 59% market share. The South African mobile phone market is considered to be the biggest on the African continent with 12 million subscribers.
The $786m the government hopes to raise from the IPO is a fraction of what it could have achieved had the IPO been launched two years ago. Today’s initial public offering gives Telkom a market capitalization of between ZAR 18.4bn ($2.1bn) and ZAR 22.8bn ($2.6bn). Telkom was valued at nearer ZAR 100bn ($11.5bn) two years ago, before the slump in technology and telecommunications stocks.
Source: Computerwire
