Crystal Ventures to list MTN shares on local bourse

Rwandans will have an opportunity to co-own MTN Rwanda when Crystal Ventures Limited, one of the country’s top firms, sells its 20 per cent stake in the firm through an initial public offering (IPO). A statement from the firm indicates that the IPO will be issued under Crystal Telecom, a subsidiary firm of Crystal Ventures, in the next two months once the Capital Markets Authority (CMA) accepts the application to issue the IPO at the Rwanda Stock Exchange. Crystal Ventures has owned the shares since 1998. In an interview with The New Times, yesterday, Robert Mathu, the CMA executive director, said they received the firm’s application last week, noting that they would give Crystal Telecom the go-ahead once they have fulfilled all the requirements. “We hope to have the IPO in this quarter. It will give the market a much-needed boost since it will be an additional product for Rwandans to invest in,” he said. Jack Kayonga, the executive chairman of Crystal Ventures, said they were offering Rwandan and institutional investors an opportunity to be co-owners of Crystal Telecom through the IPO, and therefore have indirect ownership of MTN Rwanda. “Through this IPO, we are supporting the efforts of the government to promote broader share ownership in Rwanda and further develop the local capital market,” Kayonga said. However, the firm has not yet released its prospectus, and Kayonga and Mathu were cagey about value of the firm and the number of shares the 20 per cent will translate into. Subscriber base MTN Rwanda is the largest telecom firm in the country in terms of subscriber base, and will present gains for investors, according to market analysts. The telecom commands more than 3.8 million of the 7.8 million mobile phone owners in the market, according to information from the Rwanda Utilities Regulatory Authority (RURA). According to RURA, the telecom made Rwf40 billion in revenue during the first-half of last year. The regulator is yet to publish the sector’s 2014 revenue results. “People know it is a profitable company and will subscribe to its shares during the IPO,” said Emmanuel Rugamba, the operations supervisor at CDH Capital, an RSE brokerage firm. Rugamba said the Crystal Telecom IPO would also bring in more liquidity on the market, arguing that it has been long since the bourse had an IPO. “More people will be trading the company’s shares which will bring in more liquidity that hasn’t been there for some time since Bralirwa and Bank of Kigali shares had become expensive for some people,” he noted. The last IPO at the stock exchange was in 2011 when Bank of Kigali listed its shares for trade at Rwf125 each. Yesterday, the company closed at Rwf296 a share. Of the six firms trading on the local bourse, Bank of Kigali and beverages maker Bralirwa are the only domestic companies. Listing firms Nairobi Stock Exchange-listed Nation Media Group, KCB, Equity Bank and Uchumi Supermarkets are cross-listed on the Rwanda Stock Exchange. Once listed, Crystal Telecom will become the third domestic company with shares trading at the bourse. The government recently announced it would sell its stake in Rwanda’s oldest commercial bank, I&M Bank Rwanda, through an IPO soon. In the region, Kenya’s biggest telecom firm Safaricom sold 25 per cent of the shares owned by government through an IPO in 2008. Pundits predict Crystal Telecom’s IPO to perform highly given strong performance of MTN over the years. MTN Group is listed on the Johannesburg Stock Exchange.

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Crystal Ventures to list MTN shares on local bourse