Wrap Text
MTN Ghana has commenced offer for shares in Ghana
MTN Group Limited
(Incorporated in the Republic of South Africa)
Registration Number 1994/009584/06
Share code: MTN
ISIN: ZAE000042164
("MTN Group")
MTN GHANA HAS COMMENCED OFFER FOR SHARES IN GHANA
On 29th of May 2018 MTN Group’s subsidiary, Scancom PLC (MTN Ghana) launched an Initial Public
Offer (IPO) in Ghana with the intention of listing on the Ghana Stock Exchange (GSE). The offer is
expected to be open for nine weeks and close on 31 July 2018.
As previously communicated to the market, a successful listing would meet the required localisation
condition under which MTN Ghana secured its 4G licence in late 2015. A key objective of the listing is
to target a broad base of Ghanaian investors to share in the risks and rewards of ownership of MTN
Ghana.
In 2015, MTN Ghana won a bid for a 4G/LTE licence in the 800 MHz spectrum. The National
Communications Authority (NCA) required MTN Ghana to offer Ghanaian investors an opportunity to
own up to 35% of its shares. Listing on the GSE was also confirmed by the NCA as an option to meet
the localisation requirement.
The Securities and Exchange Commission (SEC) and the GSE have approved the IPO and the listing
respectively.
Under the IPO, MTN Ghana is offering up to 4,637,394,533 MTN Ghana shares, consisting of a
combination of newly issued shares and a sale of existing shares held by MTN Group Limited through
its wholly-owned subsidiary Investcom Consortium Holding SA. The public offer represents up to 35%
of the issued shares of MTN Ghana, which implies an enterprise valuation of approximately
GHS 10 billion for MTN Ghana. As per Ghana market standards, the offer is a fixed price offer where a
volume of shares is made available at a fixed price. The minimum amount to be raised for the offer to
be deemed successful and for the listing to proceed is approximately GHS 0,35 billion, which
represents approximately 10% of the total offer size. Given the objective of targeting a broad base of
Ghanaian investors, allocation to non-Ghanaian investors is to be restricted to 5% of the issued shares
of MTN Ghana.
As per the requirements of the Ghana SEC, the Prospectus to be issued by MTN Ghana in respect of
the IPO includes forward-looking statements (Appendix A) that reflect MTN Ghana's intentions, beliefs
or current expectations and projections about its future results, operations, financial condition,
liquidity, performance, prospects, anticipated growth, strategies, plans, opportunities, trends and the
market in which it operates.
These forward-looking statements are based on numerous assumptions and are subject to known and
unknown risks, uncertainties, assumptions and other factors that could cause MTN Ghana's actual
results to differ materially from those suggested by the forward-looking statements and speak only as
of the date of the Prospectus. As such no assurances can be given in respect of these forward-looking
statements which speak only as of the date of the Prospectus and which may be impacted by various
risks and uncertainties. No undertaking or obligation is assumed to update these forward-looking
statements. These forward-looking statements are as at the date of the initial submission of the
Prospectus in February 2018.
The Johannesburg Stock Exchange (JSE) has been notified of the transaction. The Prospectus provides
that the allotment of shares will be conducted at the discretion of the MTN Ghana Board, and the
MTN Ghana Board will apply its discretion to (among other things) ensure compliance with the JSE
Listings Requirements, including with respect to related party transactions as contemplated in Section
10 of the JSE Listings Requirements.
This SENS announcement is not an offer of shares as contemplated in the Prospectus but a notice to
the market that there is information about MTN Ghana contained in the Prospectus which MTN Group
may not have publicly disclosed previously.
The Prospectus is included on the following website for information purposes only, is not intended to
market the IPO in any way and the contents of the website do not form part of the Prospectus:
www.mtn.com
Fairland
29 May 2018
Sponsor
Deutsche Securities (SA) Proprietary Limited
Appendix A
Forecast and Guidance on Profit and Loss at 31 December for the years ending31 December 2018 – 2022
GHS'million 2018 2019 2020 2021 2022
Forecast Forecast Forecast Forecast Forecast
13.0% -14.0% 13.0% -14.0%
Total revenue 4,014 4,686 5,387
growth growth
Cost of sales (1,105) (1,244) (1,387) 24.0% - 25.0% of Revenue
Gross profit 2,909 3,442 4,001
Total Opex (1,302) (1,488) (1,750) ~33.0% of Revenue
EBITDA (Pre-Management Fee) 1,607 1,955 2,250
Management Fee (184) (222) (253) 4.5% - 5.0% of Revenue
EBITDA (Post-Management Fee) 1,422 1,732 1,998
Depreciation of property, plant and
(314) (294) (341) 5.0% -6.0% of Revenue
equipment
IRU Amortisation (2) (2) (2) GHS2.4m
Amortisation of intangible assets (78) (80) (82) 1.0% -1.5% of Revenue
Operating profit 1,028 1,356 1,572
Finance income 60 52 33 1.0% - 2.0% of Total Assets
Finance cost (64) (102) (108) 3.0% -9.0% of Total Liabilities
Profit before tax 1,025 1,305 1,497
NFSL (49) (65) (75) 5.0% of PBT
Income tax expense (258) (325) (377) 25.0% of PBT
Profit for the year 718 915 1,044
Forecast and Guidance on Balance Sheet for the years ending 31 December 2018 – 2022
GHS'million 2018 2019 2020
2021 Forecast 2022 Forecast
Forecast Forecast Forecast
Non-current assets
Property, plant and as per Capex (12%-13% of Revenue) &
2,619 2,975 3,332
equipment Depreciation
as per Additions (~1.0% of Revenue) &
Intangible assets 434 407 381
Amortization
Non-current prepayment 0 0 0 Similar to previous years
IRU assets 58 56 53 IRU Asset amortisation of GHS2.4mn p.a.
3,111 3,437 3,767
Current assets
Inventories 34 75 74 ~1.5% of revenue
Trade and other receivables 335 316 313 as 5.0%-6.0% of revenue
Cash and cash equivalents 529 495 530 from Cash Flow Statements
Total assets 4,010 4,324 4,684
Equity
Stated capital 1,869 1,869 1,869 No new capital raised
Addition of retained earnings less dividends
Retained earnings 805 1,171 1,569 proposed
(~60% of net income)
2,673 3,039 3,438
Non-current liabilities
Borrowings 337 225 111 No Long Term Borrowings
Deferred tax liabilities 321 409 436 as 14%-23% of PBT
Provision for
4 4 5 5% growth over previous year
Decommissioning
663 638 552
Current liabilities
Trade and other payables 546 307 309 as 8.5%-11.5% of COGS and OPEX
Deferred revenue 63 61 60 as 2.0%-2.5% of COGS and OPEX
Other provisions 29 23 23 as 0.5%-1.0% of COGS and OPEX
Borrowings - 112 111 GHS 107m in 2021 and nil in 2022
Dividend assumed to be paid in the same
Dividend payable - - -
year as declared
Current income tax as per income tax payable (30% of PBT) and
36 142 191
liabilities cash tax payments
674 647 695
Total liabilities 1,337 1,284 1,246
Total equity and liabilities 4,010 4,324 4,684
Forecast and Guidance on Cash flow Statement for the years ending 31 December 2018 – 2022
GHS'million 2018 2019 2020 2021 2022
Forecast Forecast Forecast Forecast Forecast
Cashflows from operating activities
Post Management EBITDA + changes in
Cash generated from operations 1,097 1,465 2,003
NWC + Prov. For Decommissioning
Finance income 60 52 33 From Income Statement
Finance cost (64) (102) (108) From Income Statement
Income tax paid (4) (197) (376) Cash Tax Payments (30%-40% of PBT)
Cash Dividends Paid (~60.0% of Net
Dividend paid (1,701) (549) (646)
Profit)
Net cash generated from operating
(611) 668 905
activities
Net cash used in investing activities
Purchase of property, plant and
(665) (650) (699) 12%-13% of Revenue
equipment
Purchase of intangible assets (171) (53) (56) ~1.0% of Revenue
Increase in non-current
0 - -
prepayments
Transaction Costs (87) - -
Net cash generated from financing
(923) (703) (755)
activities
Cashflows from financing activities
Cash from share issue 1,867 No new issuance
Proceeds from borrowings - - - No new borrowings
Repayment in borrowings - - (115) GHS115.0m p.a.
Net cash generated from/(used in)
1,867 - (115)
financing activities
Net (decrease) /increase in cash and
333 (34) 35 Computed from above
cash equivalents
Cash and cash equivalents at the
197 529 495 Cash Balance from Previous Year
beginning of the year
Exchange gains on cash and cash
- - -
equivalents
Cash and cash equivalents at the
529 495 530 Computed from above
end of the year
Date: 29/05/2018 12:15:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of
the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
Sharenet Sites 
