BTCL shares to sell at P1 each

Mabeo says the prospectus will be out before end of 2015
Mabeo says the prospectus will be out before end of 2015

Exactly 352 million shares of the Botswana Telecommunications Corporations Limited (BTCL) will be available for sale to Batswana at P1 each under the country’s pioneering privatisation issue.

In a notice published yesterday, the Public Enterprises Evaluation and Privatisation Agency (PEEPA) said it has valued BTCL at P800 million with its shares split into 800 million units valued at P1 each. Government plans to offer 44 percent of its BTCL shareholding to citizens and citizen-owned companies via an Initial Public Offer (IPO), retaining 51 percent and committing five percent to citizen workers.

This will translate to government retaining 408 million shares while 40 million have been reserved for the citizen workers of BTCL and 352 million available for Batswana.

In an interview with Mmegi Business yesterday, the Minister of Transport and Communications, Tshenolo Mabeo was resolute that the IPO will be launched before the end of 2015 for a period of eight weeks.

“We are confident that the shares sale will be launched in the next 14 days, before the year ends. We have also requested the Botswana Stock Exchange (BSE) for an extension of the IPO period from the normal four weeks to eight weeks bearing in mind that during this festive season most people might have had committed their funds elsewhere,” said the minister. BSE rules stipulate that an individual can buy a minimum of 100 shares, translating to a lowest possible investment of P100.

The Implementation of BTCL’s privatisation commenced immediately after cabinet approved the privatisation strategy in June 2006.  Initially slated for August 2011, the BTCL IPO launch has undergone a series of postponements. It was first delayed to 2012, and then later pushed to August 2014 before it was again deferred to December 2014 and then 2015.

According to Mabeo, finding an underwriter for the IPO was the major obstacle that necessitated the numerous deferrals of the IPO.

“We had to find a suitable underwriter for the privatisation, as the shares cannot be sold to a foreign entity. After failing to find a local institution with the required capacity to handle such an underwriting, we then requested government to become the underwriter and they agreed,” he said. In the event of an under-subscription of the 352 million shares, government as the underwriter will take up the remaining shares. As a way of trying to guard against hoarding of shares by a financially able few, the minister said that an allotment committee will be set up that will look at how many shares have been bought each by an individual or company.

Mabeo also clarified that BTCL workers will not pay for the 40 million shares that government has reserved for them.

“The five percent shareholding for the workers is more like an incentive for the workers to have ownership of the company. The shares will be housed under a fund and get dividends as and when they are declared. The shares will not be allotted to individual workers directly,” he added.

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 Fibre Networks (BoFiNet) which is wholly owned by the government.

Editor's Comment
What about employees in private sector?

How can this be achieved when there already is little care about the working conditions of those within the private sector employ?For a long time, private sector employees have been neglected by their employers, not because they cannot do better to care for them, but because they take advantage of government's laxity when it comes to protecting and advocating for public sector employees, giving the cue to employers within the private sector...

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