MTN Uganda to sell 7% more shares for local ownership boost

Summary:

• MTN Uganda, the country’s largest telecom firm, plans to sell an additional 7% of its shares to the public to comply with regulatory requirements. The company aims to boost local participation and deepen Uganda’s capital markets.

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MTN Uganda, the largest telecom company in Uganda, intends to sell an additional 7% of its shares to the public this year to comply with national regulatory requirements. This move aligns with the company’s commitment to listing a minimum of 20% of its shares on the Uganda Securities Exchange.

In 2021, MTN Uganda fell short of its target during the initial offering to investors across East Africa, including Uganda, Kenya, Tanzania, Rwanda, and Burundi. Consequently, the government granted an extension to complete the sell-down within a three-year period.

Sylvia Mulinge, CEO of MTN Uganda, emphasized the company’s focus on localization, shared value creation, and deepening Uganda’s capital markets while releasing the financial results for 2023. Mulinge announced plans for a further sell-down of 7% shareholding to the public in 2024, aiming to broaden Ugandan shareholding and allow investors to own a stake in the company.

MTN Uganda reported a 16.1% increase in service revenue, totaling UShs 2.63 trillion in December 2023, along with a 21.4% surge in after-tax profits to UShs 493 billion. Data revenue climbed 21.6% to UShs 621.9 billion, while active data subscribers increased by 22.4% to 8.2 million. Overall subscriber numbers rose by 13.3% to 19.5 million. The company’s EBITDA increased by 16.3% to UShs 1.37 trillion, with capital expenditure rising by 5.5% to UShs 353.5 billion. MTN Uganda proposed a UShs 403.0 billion dividend to its shareholders.

Mulinge highlighted the expansion and upgrade of the network infrastructure, including the deployment of 350 additional sites, focusing on 4G LTE coverage, which reached 85.1%. The 3G and 2G networks now cover 92.6% and 98.6%, respectively. The company also launched 5G technology at 37 sites and received recognition for offering the fastest internet speeds in Uganda by Ookla.

Mulinge emphasized the success of the MTN Kabode program, which led to a 26.8% increase in smartphone users and a 39.1% smartphone penetration rate on the MTN network. The launch of e-SIM technology in the fourth quarter provided customers with seamless carrier switching and plan management capabilities.

Looking forward, Mulinge stated the company’s commitment to investing in network infrastructure, customer acquisition, and fintech innovation. MTN has partnered with Ericsson to enhance its Mobile Money (MoMo) service, aiming to bolster financial inclusion and enable secure mobile transactions for individuals and businesses. Additionally, the company is dedicated to fulfilling its National Telecom Operating License obligations, including achieving a 90% geographical coverage across Uganda by 2025.

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