The Qatari unit of the Vodafone group will launch an Initial Public Offering (IPO) in April. The IPO will see 40% of the company’s authorised share capital offered to investors between 12 April and 26 April 2009, before its listing on the Doha Securities Market (DSM) in Qatar.
CEO Grahame Maher comments: “We have a strong strategic focus on making the world of difference for the people in Qatar, and the IPO is just one part of that strategy. We hope that Qataris will be part of our success, as customers, employees and now as shareholders,” says Maher.
HSBC Bank Middle East Limited and Qatar National Bank are acting as joint financial advisers, joint lead managers and joint lead receiving banks.
Vodafone Qatar entered the mobile network on 1 March 2009, and its first 1,000 customers have been asked to help test and build its mobile network.
Irfan Ellam, equity research analyst at Al Mal Capital in Dubai, says: “The last IPO that came to market recently was the Drake & Scull IPO [a UAE contracting company] in July 2008. Apart from that, the IPO market has been quiet. Companies don’t want to raise money when there is such a great discount. Companies obviously feel that they can get better value once the market improves. On the telecoms side there have been some delays as a result of what is going on. In Oman, the privatisation of Oman Telecom is delayed, for example.”
Vodafone is one of the world’s leading international mobile telecommunications company, with equity interests in 27 countries and partner markets in more than 40 countries. As of 31 December 2008, Vodafone had approximately 289mn proportionate customers worldwide.
Commenting on the IPO, Vodafone Qatar chairman Abdulrahman Bin Saoud Al Thani says, “This is a significant IPO as it will become one of the largest IPOs in Qatar. Furthermore it marks the next step in the deregulation of the telecommunications sector in Qatar, by bringing competition to the market.”
Vodafone Qatar will be the country’s second mobile phone license holder. Qatar Telecom, or QTel, presently is the sole provider of mobile and fixed-line phone services in the country.
“Qatar Foundation’s strategy of partnering with high technology businesses that will help develop the growth of the knowledge based economy is fostering many opportunities for Qataris and we expect there to be much interest in this upcoming IPO,” says Qatar Foundation vice-president administration and Vodafone Qatar board member Rashid Al Naimi.
Whether or not the IPO will be successful is a question of time, says Ellam of Al Mal Capital: “In this region, people don’t apply for the shares until last-minute. They want to keep their money either on deposit or leave it in the market until the last two or three days of the application process.”
The IPO will consist of 338,160,000 ordinary shares, with a share price set at QR10 per offer share, with additional offering costs of QR0.25 per offer share. Only Qatari nationals and registered Qatari institutions that are 100% Qatari owned can apply for offer shares in the offering. Individual investors will be able to apply for a minimum subscription of 250 offer shares with multiples of 50 offer shares thereafter.
International investors will be able to buy Vodafone Qatar shares on the open market once it is listed on the Doha securities market after the IPO.
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