Celtel Africa to launch IPO

Celtel International has directed Celtel Africa to launch an initial public offering (IPO) to international and local investors.

Celtel Zambia Managing Director David Venn said at a press briefing in Lusaka on Tuesday that Celtel Zambia will launch its IPO on April 28. Celtel Zambia will be the first to launch its IPO, while Celtel networks in other African countries are still working on regulatory requirements.

Celtel International is a pan-African mobile network with a presence in 15 African countries including Madagascar, Chad, Burkina Faso and the Democratic Republic of Congo (DRC). It has more than 400 million subscribers.

"In Celtel Zambia, Celtel International B.V. has provided an offer for sale of over one billion shares, representing a 20 percent share capital in Celtel Zambia," Venn said.

Celtel offers voice services, international roaming, SMS and mobile Internet to subscribers in urban and remote rural areas.

Zambia's Minister of Communications and Transport Dora Siliya said the move by Celtel to sell shares is a good response to the growth of information and communication technologies (ICT) in the country.

Siliya said the Zambian government will continue providing a favorable environment that will enable mobile companies in the country to expand to rural areas.

Last week, however, Venn said Celtel was finding it difficult to expand its network to rural areas because government authorities were not giving the company incentives to foster its growth. Celtel wants authorities to reduce import tax on telecom equipment in order to quicken the company's network expansion program.

But several governments in the region are not willing to waive such taxes, claiming telecom companies are making huge profits.

Meanwhile, in Kenya, the IPO of Safaricom, Eastern Africa's largest GSM (Global System for Mobile Communications) company, has stirred up great interest. The offering period began on March 28, is due to close April 23 and is expected to end up being over-subscribed.