African mobile towers operator, Helios Tower on Thursday ditched its plans to list in London Bourse. This comes two weeks after it announced that it would be listing in the London Bourse in a few months.
According to Reuters, a banker familiar with the matter said that the expected IPO price was too low for shareholders who had been valuing the firm at as much as 2 billion pounds ($2.8 billion).
However, it is reported that Heilos has received “considerable interest” from institutional investors who liked its business plan and growth prospects but they are worried about the political and policy risks in Democratic Republic of Congo (DRC) and Tanzania.
“The valuation from market feedback was not enough for the shareholders. We had a lot of interest from investors but they wanted a discount for the political risk in DRC and Tanzania,” the banker, who asked not to be named, told Reuters.
What is happening in DRC and Tanzania?
There was a civil war in Democratic republic of Congo between 1998 and 2003 where millions of people were killed. Currently, there seems to be a deepening crisis over the tenure of President Joseph Kabila’s. President Kabila was meant to leave office in 2016 but he has refused to step down. This is raising the fears of the people of DRC again.
Although Tanzania is politically stable but the style of President John Magafuli nicknamed the “Bulldozer” attacks on the mining sector as part of an anti-corruption drive has put off foreign investors.
What you need to know about Helios
Helios manages about $3 billion in sovereign wealth funds, corporate and public pension funds, endowments and foundations, funds of funds, family offices, and development finance institutions across the globe.
The company was founded in 2009 and it is owned by telecoms companies Millicom and Bharti Airtel and hedge funds including Soros Fund Management and Rothschild Investment Trust Capital Partners.
It is chaired by the former Cobham chief executive, Allan Cook, and WS Atkins as chairman. Kash Pandya was appointed in 2015 to become the chief executive of the company.
Currently, Helios Towers owns about 6,600 telecoms towers in Ghana, Tanzania, Congo Brazzaville and the Democratic Republic of Congo.
Helios had a revenue of $345 million and a debt of $595.2 million in 2017.