Airtel Africa Ltd, a subsidiary of Indian telecoms group, Bharti Airtel Ltd, is considering a stock market flotation in London, designed to expand its data and mobile money services across Africa.
The telecoms company has also indicated interest to list on the Nigerian Stock Exchange (NSE), which is one of the 14 countries where it currently operates.
When listed on the NSE, Airtel will become the second telecommunication company in Nigeria to be so listed.
Nigeria’s biggest telecommunication by market share, MTN, on May 16, 2019 listed 20.35 billion shares on the Nigerian bourse at N99 per share.
Airtel Africa is aiming to raise about $1 billion in a June equity offering, a source close to the deal said.
Airtel operates in 14 African markets, including Democratic Republic of the Congo, Kenya, Nigeria, Rwanda, Seychelles, Uganda and Zambia.
Last year, the telecom operator raised $1.25 billion from six global investors, including SoftBank Group Corp, Warburg Pincus LLC and Temasek Holdings (Private) Ltd.
A further $200 million was raised in January from the Qatar Investment Authority (QIA), valuing the company just under $5 billion.
A report by Reuters said Airtel Africa is looking to trade on the main market of the London Stock Exchange, using its premium listing segment, which has more stringent rules than the European Union’s minimum requirements, and sell 25 per cent of new shares to reduce existing debts.
The cash injection from current investors has already helped to reduce Airtel Africa’s net debt to $4 billion in March, compared to $7.7 billion in the previous year.
Its net income reached $83 million in the year to March, compared to a net loss of $49 million a year earlier.
The Chief Executive Officer of Airtel Africa, Raghunath Mandava, in a statement, said: “The 14 countries where we operate offer strong GDP growth potential and have young and fast-growing populations, low customer and data penetration and inadequate banking infrastructure. These fast-growing markets provide us a great opportunity to grow both our telecom and payments businesses.”
Indian owner, Bharti Airtel, last year ditched the Initial Public Offering (IPO) of African mobile phone mast firm Helios Towers, without giving any reason.
A source said at that time the expected IPO price was too low for shareholders who had been valuing the firm at as much as $2.8 billion, according to Reuters.
Proceeds from the European IPO market have fallen to their lowest in more than a decade in the first three months of 2019, Reuters quoted data from Refinitiv as revealing.
Airtel Africa’s debut on the London market would follow that of Middle Eastern payments companies, Finablr and Network International, which started trading over the past couple of months.
The company has appointed JP Morgan, Citigroup Inc, BofA Merrill Lynch, Absa Group Limited, Barclays Bank PLC, HSBC, BNP Paribas, Goldman Sachs International and Standard Bank Group Ltd as advisers.