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MTN to Launch an Initial Public Offering (IPO) – An Investment Advice

MTN is expected to launch their Initial Public Offering (IPO) on Tuesday, 29 May 2018.  This has been on the blocks for a while now.  This IPO allows Ghanaians to own a 35% stake in the telecom giant.  This is a condition for the acquisition for the 4G license, which MTN is estimated to hold nearly 80% of the market. (

The 4G Market – Sept 2017

The local ownership is a step in the right direction for Ghanaians not only to patronize the services of a foreign company but to own a stake in the profits (or losses) of the South African telecom giant.

The IPO is expected to initially raise an amount of $ 787 million (USD) currently estimated at Ghs3.6 billion.  The IPO is also to deepen the investment activities of Ghana Stock Exchange by initializing this investment activity on the Ghana Stock Exchange.  Preceding discussions on the IPO suggests that this investment would be opened to Ghanaians from all walks of life., gathers from a number of investment and pension professionals that this would provide a good diversification option for the rather large (and still growing) pension funds which may be running short of good investment options.  With the declining confidence in the banking system as well as the fast declining policy rate which underlines the returns on treasury bills, fixed deposits and other fixed income assets, the size of the MTN shares on the exchange could offer some good diversification option.  Pension funds are however only expected to hold a maximum of 5% of their funds in the MTN shares at any time.  For individual investors, it would also offer good opportunities for long term investments.  Individuals who have not waded these waters before could look at this as a good investment to get them into the share ownership fraternity.  Individuals should however seek expert advice to establish and understand their own risk appetite as well as the risks in investing in shares like that of MTN.

Other developments that seem to support MTN shares as a good investment for the future are the mobile money business, further developments within the electronic money and payment space, and the quest to become the biggest bank in Africa.

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