BTC IPO faces another deferral
Keikantse Lesemela | Tuesday November 25, 2014 11:50
Initially slated for August 2011, the IPO launch has undergone a series of postponements. It was first delayed to 2012, then later pushed to August 2014 before it was again deferred to November 7 and now December 31st 2014.
Speaking during a media workshop last week, the transaction’s legal advisor, Rizwan Desai said there were still some technical regulatory issues to be addressed, which the Botswana Stock Exchange (BSE) had not yet approved. Although government officials say the latest postponement was done at the request of members of the public, Desai said that the requisite approvals were not all in place but the financial audits had been submitted to the BSE.
With just over a month before the new deadline, Desai explained that the BTCL IPO is a difficult process as it is a government project and involves two ministries. He noted that this requires extensive work and it takes time to process the required information.
“This is a large corporation. Carrying out a project of this magnitude is a long process. There are steps that should not be omitted so it needs time to complete,” he said.
He further said that the amount of shares and the price would not be disclosed until the BSE has approved them.
Implementation of BTCL’s privatisation commenced immediately after cabinet approved the privatisation strategy in June 2006. Desai added that they were compiling the prospectus, to be finalised by December 31st.
According to the Ministry of Transport and Communications, the latest deferral to December 31st was made after some members of the public said they were either not financially ready or didn’t have enough information about the public offer. The complaints were raised during the two Pitsos, which were held by the ministry last month.
BTCL was formed ahead of the separation of the incumbent operator, Botswana Telecommunications Corporations (BTC) into two entities incorporated under the companies Act, being BTCL and Botswana Fiber Networks (BoFiNet) which is wholly owned by the government. Under the BTCL IPO, the government is selling 49 percent of its shares to the public. Five percent of these have been reserved for BTC employees.
This will be delivered through an employee Share Ownership Plan (ESOP) approved by cabinet. Desai explained that a share allocation strategy would be put in place to ensure that all citizens are given equal opportunity to buy shares.