Helios Towers raised $364m in London IPO

Mobile telephone infrastructure company Helios Towers raised $364 million and listed on the London Stock Exchange yesterday 15 October. The stock HTWS launched at the bottom of the target price range at 115p and traded in a range of 115.00 – 126.98 over the day. Excluding the “greenshoe” extension the offer raised $318m, according to the London Stock Exchange (LSE).

Gokul Mani, Head of Primary Markets – Middle East, Africa & India, LSE, said in an email: “London Stock Exchange continues to be a strong partner to companies across the Middle East and Africa. Four of the five largest IPOs from the region this year have listed on our market. London’s capital markets offer deep liquid pools of capital, connecting issuers from the Middle East and Africa with long-term international investors, supporting dynamic companies, infrastructure development, and economic growth in the region. ”

In total, 124 companies from the Middle East and Africa (MEA) region are listed in London and have raised over $35 billion in equity issues. There are also 242 active MEA bond issuers who raised nearly $143bn. Of the top 10 initial public offers (IPOs) on the LSE in 2019, 4 are from MEA region. According to a Bloomberg report; “The London market is particularly quiet and Helios is one of several African and Middle Eastern companies that are helping to keep it alive.”

The share offer allowed shareholders including Millicom International Cellular SA and Bharti Airtel Ltd. to sell down their stakes. It was founded in 2009 with $350m backing by London-founded private equity firm Helios Investments alongside investors including George Soros and Madeline Albright, according to this report on Quartz .

Helios has more than 6,800 mobile telecommunications towers spread across five African countries (South Africa, Democratic Republic of Congo, Ghana, Republic of Congo and Tanzania) which it rents to mobile phone providers such as Vodacom, MTN and Airtel. It plans to use some of the IPO proceeds to keep pace with fast-growing consumption of mobile data in Africa, expand into new markets, build more towers and roll out fourth-generation (4G) mobile services. We wrote about the IPO here.

Another major mobile operator IHS Towers is raising $1.3bn via debt markets with 2 issues closing next week, according to Bloomberg, while American Tower Corp is buying a third provider, Eaton Towers Ltd. for $1.85bn.

Quartz cites Matthew Edwards, head of research for the region at research firm TowerXchange, there are 158,000 towers in Africa and “towercos” own 39.3%. There are expected to be more than 600m subscribers to mobile phones by 2025.

Towers can bring revenues to rural communities and land-owners. According to Quartz “As part of efforts to cut down costs, towercos are increasingly investing in hybrid power solutions like lithum-ion batteries and solar power. There’s a net upside for local communities housing towers given the possibility of reduced diesel consumption for generators and an accompanying reduction in emissions and pollution.”

This distinguishes Helios Towers, according to this LSEG backgrounder: “One thing that differentiates Helios Towers Africa from some of its competitors is that every site it operates also contains a mini power station. ‘This provides our customers with the uninterrupted power needed for mobile networks,’ explains Kash (CEO Kash Pandya), who is optimistic about the company’s prospects for the future. ‘It’s an exciting time to be in telecoms in Africa and a very exciting time to be in towers too.’”

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