Ouagadougou, Burkina Faso, January 8, 2009—
IFC, a member of the World Bank Group, announced today that it will support the initial public offering of Onatel, Burkina Faso’s incumbent telecom operator. The IPO, which was launched on December 22, 2008 and will remain open January 31, 2009, is the first by a Burkinabe company. It will attract private investment to the country and develop domestic and regional capital markets.
IFC plans to purchase up to a five percent stake in Onatel at the public offering price. The investment will come after IFC earlier this year committed a €7.5 million ($10.5 million equivalent) loan to support the upgrade of Onatel’s fixed and mobile networks. The investments are part of IFC’s commitment to help develop a competitive telecommunications market, increase connectivity, and improve business efficiency in Burkina Faso.
“IFC’s global expertise in telecommunications and capital markets makes it a valuable partner in this historic offering,” said Amadou Dicko, Permanent Secretary of Burkina Faso’s Commission for Privatization. “IFC’s confidence in Onatel’s economic prospects will attract local and international investors to Burkina Faso’s nascent capital markets,” added Alexis Lourgo, Managing Director at Societe Burkinabe d’Intermediation Financiere, which is managing the Onatel public offering.
IFC’s participation in the IPO is designed to not displace any private investors. IFC plans to purchase up to a five percent stake in Onatel by buying any shares not subscribed to in the offering. If all shares are sold, the government plans to sell IFC an additional three percent stake in Onatel at the offering price.
Onatel’s privatization began in 2006, when Burkina Faso’s government sold a 51 percent stake to Morocco’s Itissalat Al-Maghrib S.A. (Maroc Telecom). The government will sell a further 20 percent of Onatel’s capital in the offering.
“IFC is committed to supporting an improved telecommunications infrastructure in Burkina Faso due to the enormous overall development impact it can encourage,” said Yolande Duhem, IFC Director for Western and Central Africa. “Onatel’s public offering will set standards and deepen domestic and regional equity markets so that private businesses can have better access to capital.”
IFC’s support of Onatel’s IPO comes after IFC became the first nonresident institution to issue a bond denominated in West African francs in 2006, helping develop West Africa’s local currency bond market. Burkina Faso is one of eight countries that use the West African franc.
IFC, a member of the World Bank Group, creates opportunity for people to escape poverty and improve their lives. We foster sustainable economic growth in developing countries by supporting private sector development, mobilizing private capital, and providing advisory and risk mitigation services to businesses and governments. Our new investments totaled $16.2 billion in fiscal 2008, a 34 percent increase over the previous year. For more information, visit