The Mobile Telecommunications Company group General Assembly of Shareholders met yesterday and approved a capital increase. The issued capital of the company will be increased by 100% for all shareholders eligible to participate in a rights offering. The rights offering will result in an increase of share capital (par value 100 Fils) from KD 55.42 million to KD 109.72 million through the issuance of 543,013,460 new shares (KD 54.3 million). The rights issue will allow eligible shareholders to purchase shares equal to the shares they own on the record date at KD 1.25 – 100 Fils par value and KD 1.150 premium over par.
The General Assembly decision stipulates that shareholders of record on the day preceding the date of the subscription to the capital increase as announced in the publication of the subscription notice in the Official Gazette (Kuwait Al Yom) will be entitled to participate in the rights issue.
Commenting on the General Assembly approvals; the largest capital increase to date in Kuwait as it is expected to raise over KD 675 million, the Chairman of MTC Mr. Asa’ad Al-Banwan said: “MTC’s Board of Directors is intent on continuing the successful expansion plans of the company and this capital increase is a necessary step that will allow the company to increase its presence and footprint in the Middle East and Africa with an eye on truly global coverage.” Mr. Al-Banwan added: ”MTC began the implementation of its ambitious expansion strategy early 2003 when the share price of MTC was KD2.020 (as of year end 2002) and today the share is trading at KD 5.350 taking into account cash dividends of KD 0.140, 0.150, and 0.160 as well as stock dividends of 5% and 7%. These returns to shareholders reflect the operational performance of the company during that period confirming the soundness of the expansion strategy.”
Mr. Al-Banwan went on to add: “The capital increase proceeds will allow the company to repay part of the loan secured for the acquisition of Celtel in April 2005 and enhance the financial position of the company when competing for growth opportunities.” Mr. Al-Banwan also said: “Shareholders of record who will participate in the capital increase are the owners of MTC shares the day before the publication of the subscription notice in the official gazette. The shareholders approval of the capital increase during the General Assembly Meeting is the first step
and the company will diligently pursue the approvals necessary to launch the subscription so that it may participate in any attractive expansion opportunities that meet the Boards stringent criteria.”
It is noteworthy that MTC’s market capitalization has increased by USD 4 billion during the last 4 months and since its announcement of its acquisition of Celtel.
Mobile Telecommunications Company (MTC) was founded in 1983 and is today one of the largest mobile operators in the Middle East and Africa, offering a comprehensive range of world-class voice and data mobile services to over 10 million customers spread across 18 countries – Kuwait, Bahrain, Jordan, Iraq, Lebanon in the Middle East and 13 countries in sub-Saharan Africa- Burkina Faso, Chad, Democratic Republic of the Congo, Republic of the Congo, Gabon, Kenya, Malawi, Niger, Sierra Leone, Sudan, Tanzania, Uganda and Zambia..
Listed on the Kuwait Stock Exchange, MTC’s market capitalization exceeded US$10 billion as at August 1, 2005. The shareholder base consists of 75.4% public and 24.6% by the Kuwaiti government. For the year ending December 31, 2004, consolidated revenues were KD 322.327 million (US$1.009 billion) and consolidated net income was KD 120.24 million (US$410 million).
MTC's corporate strategy can simply be summarized as "3x3x3", an ambitious, sustainable expansion strategy that will see MTC become a leading mobile and lifestyle services provider on the global stage by the end of the year 2011. Initiated in year 2002, it is this strategy that will make MTC a global player in three stages: regional, international and global, with each stage completed in three years, with an aim of reaching a subscriber base of 20 million. In essence, through acquisitions, partnerships and green-field opportunities, MTC aims to achieve in nine years what other companies have taken more than 27 years to achieve.
In addition to securing the best possible returns for shareholders cohesive with a high standard of corporate governance, MTC considers itself defined by a commitment to excellence in providing world-class mobile services and an ethos of corporate social responsibility in supporting communities, offering employment and creating business opportunities wherever it operates.
