35m Shares of Etisalat Goes on Sale by Private Placement

Premium Telecommunications Holdings Limited (PTHL), a special purpose vehicle which holds the interests of Nigerian investors in Etisalat Nigeria has offered for sale by private placement 35 million shares held by Karington Telecommunications Limited of Etisalat Nigeria.
The 35 million shares is about 17.5 percent of the Nigerian company and is being priced at $10 per share with a market capitalization of $350 million or N56 billion at a conversion rate of N160 to the dollar.
Private placement is raising of capital via private rather than public placement. The result is the sale of securities to a relatively small number of investors. Investors involved in private placements are usually large banks, mutual funds, insurance companies, and pension funds as well as high networth individuals.
The placement is being done to enable a greater number of Nigerian nationals and companies to participate in the opportunity. By acquiring shares in PTHL, potential investors will acquire indirect interests in Emerging Markets Telecommunications Services (EMTS).
EMTS, is Nigeria’s new GSM-based telecommunications network and operates under the “Etisalat” brand as “Etisalat Nigeria”. By acquiring shares in PTHL, potential investors will acquire indirect interests in EMTS.
The offer which opened on March 23, 2009 is scheduled to close on April 24, 2009.
The issuing house to the offer is FSDH Asset Management Limited (FAML) while each share is being offered at a unit price of $10.
Investors are required to subscribe to a minimum of 100,000 units, which brings the minimum value of investment to $1million.
According to the prospectus, investors could also apply for additional multiple shares of 50, 000 units which cost $500,000.
Etisalat, is a Nigerian company incorporated under the laws of Nigeria in partnership with Mubadala Development Company and Etisalat of the United Arab Emirates.
Incorporated in Nigeria as a private company, it acquired the Unified Access License from the Federal Government in January 2007. The license includes a mobile license and spectrum in the GSM 1800 and 900 MHz bands at a price of $400million (Four Hundred Million U.S. Dollars). Etisalat acquired a 40% stake in EMTS and is now the operator of the Unified Access License.
Etisalat has been the telecommunications service provider in the United Arab Emirates since 1976. In its 32 years of operations, it has built up state-of-the-art telecom infrastructure and taken a leadership position of innovation and reliability among regional and international operators.
Etisalat has footprints in 16 countries traversing the Middle East, Asia and Africa. In Africa, Etisalat’s operations span 10 African nations including Sudan and Zanzibar. It therefore begins operations in Nigeria with considerable experience in successfully rolling out networks in challenging terrains.
In Nigeria, Etisalat made the first official call on its network on the 13th of March 2008 in the presence of dignitaries from the Nigerian Communications Commission (NCC) and the Senate of the Federal Republic of Nigeria.