Rwanda IPO Alert: MTN Rwanda Primer


We’ve covered Rwanda’s equity markets before in this post. It has grown substantially since its first IPO in December 2010 but investing options remain limited with just two stocks listed on the domestic exchange. Fortunately, there has been increased discussion about the Rwanda Stock Exchange’s third listing, this time for MTN Rwandacell (aka MTN Rwanda). Here are the essential details about this upcoming IPO:


MTN Rwanda is the Rwandan subsidiary of MTN Group, a telecommunications company that operates in 21 countries across Africa and the Middle East. In Rwanda, MTN is the market leader with 3.6 million subscribers and coverage in 98% of the country.  They offer a full range of telecommunications products including fixed line and mobile phones, as well as internet access as an ISP. As the largest telecom company in Rwanda, they cater to both residential and corporate customers. They are also involved in mobile banking through MTN Mobile Money, with transactions of $36 million USD sine 2010. MTN is also a leader in CSR efforts in Rwanda, donating up to 1% of post tax profits to charitable efforts through its MTN Foundation.


There are currently two main shareholders of MTN Rwanda: the parent MTN Group and Crystal Ventures, a Rwandan investment firm commonly known as the investment arm of the ruling political party. Currently MTN Group owns 80% of MTN Rwanda after Crystal Ventures sold 25% of the company to them in October 2011. The upcoming IPO will be for the remaining 20% of MTN Rwanda that Crystal Ventures still holds.


Since Crystal Ventures has approached the Rwandan Capital Markets Authority about listing its shares, MTN Rwanda will list on the Rwandan stock exchange. MTN Group already trades on the Johannesburg Securities Exchange in South Africa, but it is important to note that this is not simply a cross listing of MTN Group shares.


Crystal Ventures stake in MTN Rwanda dates back almost 15 years ago when the company was first founded in 1998. Having already divested most of their stake to MTN Group in 2011, they are now looking to exit the remainder of their investment. They focus on investments with high social and economic impact and MTN Rwanda is clearly a mature investment at this point.  The Rwandan stock exchange is also in need of a boost since there has been no IPOs in two years, and the selection of listed companies remain limited. The MTN initial public offering will be similar to the Bralirwa IPO back in 2010, where the Rwandan government decided to float their minority stake while the majority of shares were still retained by parent company Heineken.


Local media and brokers are announcing this as if the IPO is imminent. However, since we have yet to see a prospectus or any details about subscriptions, an IPO in Q1 of 2014 is the main target for now with a small chance it could be in December 2013.

How much:

How much MTN will IPO for is the question on all investors’ minds but unfortunately details right now are sparse. Under MTN Groups’ financial statements, Rwanda is included with the “Small Opco” cluster along with 13 other countries, giving little clarity about how the business is doing. However, we did find one number of interest: 487 million rand (about $48.5 million USD at the time), the amount that MTN Group paid Crystal Ventures for a 25% stake back in October 2011. Since then, MTN Rwanda has grown by a third from 2.7 million to 3.6 million subscribers today, so we expect the remaining 20% stake to be worth more than that.

Everything will be much clearer once the prospectus is released, and we look forward to learning more about MTN Rwanda in the months to come.


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