REGULATION | Ethio Telecom to Sell 10% to the Public via the TeleBirr Super App Ahead of the Ethiopian Stock Exchange Launch, marking a significant step toward broader public participation in the country's financial markets. This move aims to increase transparency and foster economic growth by allowing citizens to become shareholders in one of Ethiopia's leading telecommunications companies. The government and Ethio Telecom are working together to ensure a smooth process, with plans to educate the public about investment opportunities through digital platforms and outreach programs. The Ethiopian Stock Exchange is expected to open soon, providing a new avenue for investment and economic development across the nation.

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

The share sale will take place from October 16, 2024, to January 3, 2025, the company said. Applicants are required to be Ethiopian citizens and to be users of the TeleBirr Super App.

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

This move is part of the company’s plan to list on its country’s first stock market, which is expected to launch next month, said CEO Frehiwot Tamiru, at a ceremony attended 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 telecom company 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 telecom sector is one of the most lucrative areas ahead of privatization, given the population of 132 million. In comparison, Kenya’s leading mobile money market 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 telecom license and began commercial operations in 2022.

By floating 10% of its shares, Ethio Telecom also takes the first step toward the government divesting a further 45% stake in the telecom provider to investors.

According to Brook Taye, CEO of Ethiopia Investment Holdings, the owner of the telecom, the government is open to relaunching the tendering process for a second private telecom license.

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