BTCL IPO postponed again

The much anticipated initial public offering of Botswana Telecommunications Corporation Limited (BTCL) has now been postponed to next year, sparking fears that potential investors will get tired of government’s incessant postponements and lose confidence in the Corporation. The Ministry of  transport and communications (MIST) on Friday announced that the postponement was necessitated by a number of considerations. The release said the December 31 deadline that was set was very ambitious because the BTCL listing was a challenging task, considering the complexity and sheer magnitude of the exercise.

“It was always an ambitious time line to conclude before year end, even though we believed it was achievable. A number of material steps including securing the necessary underwriting arrangements, remain to be concluded,” read the statement.

The Ministry also reminded stakeholders not to overlook the magnitude of the work that has been completed thus far, saying the journey to this point has taken many man hours over a number of years. The Ministry also expressed confidence that the remaining steps will be comfortably achieved in 2015. It also revealed after consultations with potential individual and institutional investors it was repeatedly reminded of its mandate to ensure that the IPO allows maximum potential for citizen participation.

“A deferred IPO opening would have additional benefit of allowing more Batswana to participate in what will be the most significant listing in the history of this country,” read the statement.
Other stakeholders also felt that listing BTCL over the holidays break would not allow them enough time to conduct their own internal processes like convening investment committees and seeking board approvals. The Ministry therefore stated that after considering all advice and guidance from its project team it decided not to rush the relevant authorities and postponed the IPO to a date that will be announced in the new year.

The listing was initially postponed in August and later from November 7 to December 31, this time after government said individual citizens had shown limited understanding of the IPO and how they could benefit from it.

At the time, government promised to extend the date for the launch of the share offer to enable Batswana to identify sources of funding and also to intensify its awareness campaigns. The IPO has been hailed as a watershed moment in Botswana’s history of privatization and the first of its kind to take place in the Botswana Stock Exchange (BSE). In the IPO, government would retain 51 percent shareholding while 49 percent would be bought by citizen investors. However, concerns have been raised that the repeated postponements will lead to huge losses as investors will soon lose confidence in BTCL.