Orange Said to Pick BNP, Morgan Stanley to Advise on Africa IPO

JOHANNESBURG (Capital Markets in Africa) – Orange SA, France’s biggest phone company, picked BNP Paribas SA and Morgan Stanley to advise on a proposed initial public offering of its Middle East and Africa business, people familiar with the matter said.

The banks are helping with preparations for the listing, though an underwriting syndicate hasn’t yet been formalized, the people said. Orange plans to invite more banks to join the deal at a later stage, according to the people, who asked not to be identified because the information is private.

The deal is poised to be one of the biggest listings to come out of the Middle East and Africa in 2020. Orange is considering London and Paris as potential venues for the share sale, which could take place as soon as the first half of this year, the people said.

The company would follow Bharti Airtel Ltd.’s Africa unit and Helios Towers Plcin seeking to tap a wider investor base and raise capital for expansion. Any transaction will add to the $26.5 billion of IPOs in Europe over the past 12 months, according to data compiled by Bloomberg.

Accelerating Growth
Deliberations are at an early stage, and Orange could still decide against pursuing the listing, according to the people. Representatives for BNP Paribas and Morgan Stanley declined to comment.

Orange said in a statement that it put all its Middle East and Africa activities into a separate entity to provide “various options for growth.” An IPO is one potential scenario, and the ultimate decision will depend on factors including which option will best accelerate the company’s growth, Orange said.

The company’s Middle East and Africa business reported 1.67 billion euros ($1.8 billion) of adjusted earnings before interest, taxes, depreciation and amortization in 2018. It accounted for about 13% of the group’s adjusted Ebitda, Orange said in a June investor presentation.

Sales from the region rose 5.1% that year to 5.2 billion euros. Orange has a presence in about 20 countries across Africa and the Middle East, with major markets including Senegal, Ivory Coast and Mali, according to its website.

Source: Bloomberg Business News