REGULATION | Ethio Telecom to Sell 10% to Public via TeleBirr Super App Ahead of the Ethiopian Stock Exchange Launch

Ethiopia’s state-owned telco, Ethio Telecom, has announced a share price of 300 Birr ($2.54) for the 100 million shares it plans to sell via the company’s mobile payment service.

The share sale will take place from October 16, 2024 to January 03 2025, the company said Applicants are required to be Ethiopian citizens and be a user of the TeleBirr Super App.

TeleBirr, the company’s digital payments platform, will be used to fill out the application for share purchase and they are required to complete the payment within 48 hours.

The moves is part of the company’s plan to list on its country’s maiden stock market expected to launch next month, said CEO, Frehiwot Tamiru, at a ceremony graced by Prime Minister, Abiy Ahmed.

“Today marks a significant milestone as we launch the sale of Ethio Telecom shares, an essential step in our ongoing journey from political revolution to evolution over the past six years. Key reforms, including the development of Digital Ethiopia, have created the foundation for this moment, enabling progress across various sectors,” Ahmed said on X.

“With 50 million Ethiopians transacting via mobile money, the 130-year-old Ethio Telecom is offering 10% of its shares to the public, laying the groundwork for Ethiopia’s stock market and expanding access to ownership in one of the nation’s leading state-owned enterprises, which has now evolved into a share company.

Congratulations to all!”

The launch of a stock exchange next month, along with the privatization of state-owned companies, is part of Prime Minister Abiy Ahmed’s efforts to attract more private investment into Ethiopia.

Ethiopia’s leading telco said it increased its subscriber count by 8.9% in July 2023, reaching 78.3 million in July 2024. Meanwhile, during the same period, Safaricom Ethiopia added 250,000 subscribers to reach 4.6 million.

The country’s telcos sector is one of the lucrative areas ahead of privatization given the country’s population of 132 million. In comparison, leading mobile money market Kenya has a population of 56.7 million, with an estimated 38 million users.

Ethio Telecom held a monopoly before a consortium led by Kenya’s Safaricom won the country’s first private telecoms licence and started commercial operations in 2022.

By floating 10% of it shares, Ethio Telecom also makes the first step towards the government divesting a further 45% stake in the telecoms provider to investors.

According to Brook Taye, the CEO of the telco’s owner, Ethiopia Investment Holdings, the government is open to relaunching the tendering process for a second private telecoms licence.

“We still think that this is a three-operator market, especially when you add the B2B and B2C sector, and broadband services to houses and offices. It’s a huge opportunity,” Brook said in a Reutrs interview.“So we’re still very much interested, and welcome any interest from operators.”