Muscat: The much-awaited public offer of Oman Telecommunications Company (Omantel) shares to the Omani individuals will open on Monday, which is the second phase in the Government's divestment plan.
This follows the successful completion of the first phase under which there was private placement of 71.25 million shares with high net worth Omani individuals and institutions on a book building and auction basis.
The Ministry of Finance has reserved a further 71.25 million shares under the public offer for Omani individuals at an attractive fixed offer price of OMR1.350 per share. The public offer price of OMR1.350 per share is currently at a discount of 150 baisas or 11.1 per cent to the ex-dividend Omantel share price of OMR1.500 per share at the end of last week on March 27, 2014.
The public offer will be open for subscription for two weeks and will close on April 13, 2014. Application forms and information memorandum relating to the issue are available at the branches of all the leading banks in Oman.
The government in consultation with the CMA will endeavour to allot maximum shares, subject to over subscription, and the Omani investors may consider applying for the maximum limit of 10,000 shares for themselves and their family members.
While Omantel distributed annual dividends of 100 per cent for 2009, 2010 and 2011, the dividends were increased to 115 per cent for 2012 and 2013.
At the annualised dividend rate of 115 per cent on the public offer price, the Omani investor will effectively get a dividend yield of 8.51 per cent, which is the highest among all the shares included in the MSM 30 Index. The recent annual general meeting of Omantel (on March 24) has already declared an interim dividend of up to 40 per cent which will be paid in a few months time in August 2014, and the investors in the public offer can benefit from the interim dividend if they hold the shares until August, 2014.
Saud Nasser Al Shukaily, the Chairman of the Supervisory Committee for Omantel Divestment at the Ministry of Finance, emphasised on the government's intention towards 'sharing opportunities and spreading ownership' by divesting part of the government's share-holding in Omantel.
Bank Muscat, who is the financial advisor to the Government and also the exclusive lead manager to the share offer, expressed their satisfaction with initial feedback received to the public offer, after the successful completion of under which the private placement was subscribed 1.99 times.
Given that only 50 per cent of the appetite of high net worth, Omani individuals and institutions was satisfied under the private placement phase, it was expected that post listing of the public offer, there will be a strong demand for Omantel shares on the MSM from these Omani investors, in addition to the non-Omani investors who have not been part of the Government's current Omantel Divestment process.
Omantel is the leading telecom service provider in Oman with a growing subscriber base of over three million and 58.5 per cent share of the mobile market in Oman. The latest financials of Omantel indicate that there has been consistent growth in revenues and profitability over the years and Omantel looks forward to positive performance over the foreseeable future.
© Times of Oman 2014
