Investment

Econet InfraCo IPO could be Zimbabwe’s biggest

Econet InfraCo IPO could be Zimbabwe’s biggest

The largest IPO in Zimbabwe’s capital markets history may be imminent after Zimbabwean telecoms business Econet Wireless set a US$1 billion valuation for Econet InfraCo, its new infrastructure development and management business.

Econet InfraCo owns, operates, and manages Econet Wireless’ national portfolio of telecommunications assets. It's Zimbabwe’s largest private infrastructure group, comprising towers, power and real estate. And now its preparing for a listing on the Victoria Falls Stock Exchange (VFEX).

Econet recently published details of Econet InfraCo for the first time, showing strong revenue and profitability. Local reports say the valuation of Econet InfraCo is made up of Econet’s implied market capitalisation of approximately US$507 million, plus the implied valuation of Econet InfraCo of approximately US$1 billion, as determined by the independent financial advisor. This reflects the intrinsic value of the Group’s real estate, passive telecommunications infrastructure and renewable energy assets.

The idea behind spinning out Econet InfraCo is to allow it to pursue wider infrastructure-related opportunities in the country. The recently announced Econet Industrial Park, which is set to be developed on a 1,000-acre site near the Harare main airport, is just one example.

We reported these plans in December. Then, in January, Zimbabwe’s Ministry of ICT, Postal and Courier Services said it planned to support EconetWireless’ plan to develop the industrial park – which will also include a new data centre to support the government’s upcoming national AI strategy.

The listing of Econet InfraCo on the VFEX will be done by introduction, which means the company will not be looking to raise new capital. Instead, Econet InfraCo will issue shares to existing shareholders, creating new value.

Shareholder approval may be required prior to the IPO, but if all goes to plan the newly listed firm will focus on attracting new investments in real estate, a sector it believes has “significant growth potential". The tower segment will benefit from a long-term anchor tenant relationship with Econet and opportunities for infrastructure sharing. 

The power unit will initially concentrate on internal operations, but Econet InfraCo aims to establish itself as a major player in the power sector due to its extensive site network, which will allow it to serve customers nationwide.

Unlocking infrastructure value to power digital expansion isn’t unusual. As ITWeb Africa points out, by carving out its infrastructure into a standalone, dollar-denominated vehicle, Econet joins big names like MTN Group, Vodacom, Airtel Africa and Orange MEA that have pursued similar initiatives.

It’s quite an impressive achievement for Econet Wireless to have reached this stage given that it went through a five-year legal battle just to get a license to operate. The company launched Zimbabwe's first private network on 10 July 1998.



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