Managing Director of the Ghana Stock Exchange (GSE), Kofi Yamoah has stated the local bourse is excited about MTN’s IPO which if successful will lead to a listing on the exchange.
Speaking exclusively to JoyBusiness, Mr Yamoah described MTN’s listing as one that would attract a large number of retail investors to the capital market and boost activity if their IPO is successful.
“The telecoms sector has attracted a large number of GH subscribers, MTN alone has 7 million plus subscribers and so if in the course of its offer, we can leverage on that to get a minimum of 1 million subscribers out of the 7 million being retail investors on this market, that will bring us a lot of liquidity post-listing of MTN.”
He said the telecoms sector which is part of the services sector-a major contributor to GDP is rapidly growing and thus a local bourse should have listed a multiplicity of companies such as telecom companies, which serves as a measure of economic activity in a given country.
“Ideally for any exchange, it should be a barometer of major economic activities that go on in a country. So if we have this exchange and we don’t have the telecoms sector represented then the context of being a true reflection of all the major economic activities, we lacking in that regard” he stated.
He also describes this listing, post-IPO as one that would provide an opportunity for private pension funds as well as the national pension fund, SSNIT to channel pension contributions to the stock market.
Mr Yamoah stated the GSE had undertaken some advocacy over the years to ensure local content when it comes to companies with a foreign multinational shareholding listing on the Ghana Stock Exchange.
“Some will argue with you that you don’t have to use compulsion in terms of they coming but if you want to give meaning to local content then it shouldn’t just be contracts and supplies and so forth but also local content in terms of ownership of some of these entities,” he said.
He also espoused a wide array of benefits from getting companies with large foreign multinational shareholdings to list on a local exchange.
“You allow the Ghanaian investors to invest in these profitable entities so it creates wealth for the population. It brings many of the so-called informal sector to the formal sector because once someone buys into shares he really becomes part of the formal sector because dividends and so forth have to be paid through bank accounts, mobile accounts and so forth.”
He again added that this ensures the usual repatriation of dividends etc. from within the country is reduced as the local ownership will ensure, all things being equal will stay within the country. This some argue has significant positive impacts on our foreign exchange market.
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