Helios Towers pulls £2bn London IPO as it considers merger options
Helios Towers, an African telecoms tower company, cancelled its plans to float on the London Stock Exchange this morning.
Though Helios gave no reasons for pulling the initial public offering (IPO), saying it had received “considerable institutional investor interest”, a source told City A.M. that the business was exploring merger opportunities.
Eaton Towers, a similar business operating across Africa, is one likely target, the source said. Eaton was also expected to list in London this year, but has yet to formally issue its intention to float.
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Meanwhile one banker working on the Helios IPO said the float flopped due to lower-than-expected pricing, according to Reuters. Existing shareholders had been hoping Helios would be valued at around £2bn.
Helios’s investors include Helios Investment Partners, George Soros-backed Quantum Strategic Partners, former US secretary of state Madeleine Albright’s hedge fund Albright Capital Management, Lord Rothschild-chaired RIT Capital Partners, the International Finance Corporation and Millicom International Cellular.
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Helios has more than 6,500 towers across four markets including Tanzania, Democratic Republic of Congo (DRC), Congo Brazzaville and Ghana. It builds and manages the towers, before leasing them to operators across the continent.
But investors may also have been deterred by political tensions in DRC, as President Joseph Kabila – who promised to resign in 2016 – remains in power.
Though Tanzania is more politically stable, warning bells may have been sounding in investors’ ears after a heavy handed government approach to combatting corruption in mining caused shares in businesses such as Acacia Mining to crash.
Read more: Shares in Acacia Mining surge after Barrick Gold and Tanzania strike a deal