Rwanda’s leading telecoms firm and one of the country’s most profitable companies have decided to take it a step further by listing on the Rwandan Stock Exchange. This development follows the company’s recorded profit of about Rwf6.8 billion in profit after tax in 2019 and total revenue of about Rwf125 billion. In 2018, the firm had a profit of Rwf7.7bn. By listing on the Stock Exchange, the continental firm will allow Rwandans to invest and partake in its returns.
Listing by introduction is often preferred by firms already in another exchange. This occurs when a company lists its existing shares on an exchange. Given that said company is listing shares that had already been fully paid for, the aim of listing by introduction is not to raise capital immediately, but could serve the purpose later. This will bring the total number of firms on the Rwanda Stock Exchange to 11.
MTN Rwanda has two main shareholders, MTN Group Limited and Crystal Telecom Limited which holds 20 per cent shares in the firm. The development will see the 20 per cent stake held by Crystal Telecom held directly by the public.
While 100 per cent shares of MTN Rwanda will be listed on the stock exchange, the 20 per cent stake held by Crystal Telecom will be available for trading by the public. MTN group will hold the 80 per cent shares. Crystal Telecom is yet to provide details on what the development means for holders of their shares.
The CEO of MTN Rwanda Mitwa Ng’ambi said that the listing is proof of their commitment to investing locally. “The listing reaffirms our commitment to Rwanda. This is a transformative event in the MTN story, and one that we are certain we could not have reached without the support of our stakeholders, partners and customers,” said Ng’ambi.
The listing is expected to broaden public ownership over time, supporting sustainable growth for national development. MTN Group President and Chief Executive Officer Ralph Mupita said that the development is a step towards increasing local participation in the company, and building the capital markets in Rwanda.
The listing is subject to applicable regulatory and governance approvals as well as a conducive market conditions. The firm is projecting revenue growth in 2020 of about 12 per cent buoyed by increased Mobile Money and data usage.
Listing on the stock exchange means that the firms can easily raise capital needed for expansion.
Rwanda Stock Exchange in 2020 gained two additional players to reach the minimum 10 players requirement for consideration under the World Bank Doing Business Report’s protection of minority investors indicator. The latest entrants were; cross listing of RH Bophelo Limited as well Cimerwa’s listing by introduction.