RighTel Says Planning IPO, Details Unclear

EghtesadOnline: Iran’s third largest mobile operator, and the country’s first 3G network, RighTel, announced on April 8 that it intends to list its shares on the Tehran Stock Exchange (TSE) in the coming months following a successful sell-off of Islamic sukuk bonds in recent weeks.

News ID: ۷۴۰۸۷۲

10 April 2017

Outlining the plans at a recent AGM meeting, the company director, Majid Sadri, said the company’s plan is to be listed on the TSE soon, local technology news agency CITNA reported on April 8.

Sadri did not say what percentage of the shares the company intends to offer in the market.

RighTel has suffered in the past 18 months with the advent of the two other big networks, MTN-Irancell and MCI (Hamra e-Avval) launched their 3 and 4G networks, piling pressure on their much smaller peer that lost its advantage of being the only third generation network operating in the country, Financial Tribune reported.

According to one source close to the proposed deal, talks remain informal at this stage and formal negotiations about the IPO will start soon.

According to CITNA, Sadri said, “Technology transfer and adding new employees is on the company’s agenda. RighTel has made significant economic growth in recent years.” He, however, did not say anything about the company’s present market share.

Following the sukuk sale, however, the company boss said RighTel “has paid its debts to the Ministry of Communications and Information Technology” but did not elaborate on how much it had originally borrowed from the government.

Maysam Hosseini, a financial analyst at the Securities and Exchange Organization (SSO) said of the deal, “When it comes to capital structure any company [those who] wish to list on TSE have to be profitable for at least a year and there must be no accumulated losses, otherwise they have to restructure their books.”

He went on to say “It seems they have been able to use some financing to cover their losses,” referring to the recent bond sale among other cash generating exercises.

The company also signed deals in recent months with new Mobile Virtual Network Operators (MVNO) who were given license to host new networks off the back of the three traditional mobile network operators. The deals should act as an added revenue stream for the operator.

RighTel was established by the Social Security Organization in 2011 and started expansion of its services in 2012.