Grameenphone plans for $65 mln IPO

­Bangladeshi mobile operator Grameenphone has filed its final application for an initial public offering (IPO) of US$65 million. The company expects the subscription period for the IPO to be late January or early February next year.
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In July, Grameenphone, which is 62%-owned by Norwegian telecom operator Telenor said it planed to raise up to US$300 million in share sales on the domestic stock exchanges. This was later cut to US$125 million - and now has ended up with the final amount of just US$65 million.
"We are proud of our achievement in having reached this milestone. We remain committed to contributing to the development of the capital markets of Bangladesh and look forward to a successful completion of the largest IPO in the country" said Oddvar Hesjedal, CEO of Grameenphone.

Bangladesh's top mobile phone carrier, Grameenphone controlled by Norway's Telenor (TEL.OL: Quote, Profile, Research), on Thursday filed its final application for an initial public offering (IPO) of $65 million, the country's biggest ever IPO.
The price for the IPO has been proposed at 7.00 taka, subject to Securities and Exchange Commission approval, Grameenphone said.
Last month, Grameenphone cut a planned share sale to $125 million from $300 million due to the sharp downturn in global markets. The revised plan includes a $75 million IPO and $50 million pre-IPO placement.
In the pre-IPO placement, Grameenphone raised a total $60 million at 7.4 taka per share due to strong demand from more than 50 local investors.
Initially the company had hoped to raise $150 million through a private placement and a similar amount through a subsequent domestic initial public offering.
"We are proud of our achievement in having reached this milestone. We remain committed to contributing to the development of the capital markets of Bangladesh and look forward to a successful completion of the largest IPO in the country," said Oddvar Hesjedal, Grameenphone's chief executive.
Citigroup (C.N: Quote, Profile, Research) is underwriting the share sale.
Grameenphone was founded in 1996 by Norwegian telecoms group Telenor, the second-largest foreign operator in Asia, and Grameen Bank, which was launched by microfinance pioneer and Nobel Prize winner Muhammad Yunus.
At end-October, Grameenphone had 20.8 million subscribers, around 48 percent of the nation's total and well ahead of Egyptian Orascom Telecom's ORTE.CA Banglalink and Telekom Malaysia's (TLMM.KL: Quote, Profile, Research) Aktel.

Analysts predict the number of subscribers in the country could top 70 million by 2011, nearly half its population of more than 140 million.
($1 = 68.88 taka)

Service offered by grameen phone

Grameenphone offers subscription in two categories, Prepaid Subscription and Postpaid Subscription.

Prepaid subscriptions are sub-divided into three plans:

smile (mobile to mobile connectivity within Bangladesh),
smile PSTN (nationwide and international mobile and land line connectivity)
djuice (a youth based mobile to mobile connectivity within Bangladesh).
Postpaid plan:

xplore (nationwide and international mobile and landline connectivity)
Grameenphone also offers different value-added services including SMS, MMS, Welcome Tunes (Ringback Tones), Voice SMS, SMS Push-Pull Service, Voice Mail Service (VMS), and Fax and Data among others. Grameenphone was the first mobile operator in Bangladesh to offer EDGE services to its subscribers.


Other activities

Village phone
With the help of Grameenphone, Grameen Telecom operates the national Village Phone programme, alongside its own parent Grameen Bank and the International Finance Corporation (IFC), acting as the sole provider of telecommunications services to a number of rural areas. Most Village Phone participants are women living in remote areas. Village Phone works as an owner-operated GSM payphone whereby a borrower takes a BDT 12,000 (USD 200) loan from Grameen Bank to subscribe to GP (Grameenphone) and is then trained on how to operate it and how to charge others to use it at a profit. As in September 2006, there are more than 255,000 Village Phones in operation in 55,000 villages around Bangladesh. This program has been replicated also in some other countries including in Uganda and Rwanda in Africa.[5]


A typical Grameenphone tower
Community Information Centers
Community Information Center (CIC) or GPCIC is aimed at providing internet access and other communications services to rural areas. In February 2006, 26 CICs were established across the country as a pilot project.[6] In this project, Grameenphone provides GSM/EDGE/GPRS infrastructure and technical support and other partners Grameen Telecom Corporation and Society for Economic and Basic Advancement (SEBA), are involved in selecting and training entrepreneurs to run the village centers. The computers in these centers in the pilot project are used by an average of 30 people a day, who pay a small fee to access email or Web pages.[7] These CICs are used for a wide variety of business and personal purposes, from accessing health and agricultural information to using government services to video conferencing with relatives overseas. Grameenphone also trains the entrepreneurs so that they can give people advice on how to set up an e-mail account and best make use of the Internet.

CIC project is giving up to 20 million people the chance to use the Internet and e-mail for the first time. Following a successful pilot project, Grameenphone is going to set up approximately 560 centers in communities throughout Bangladesh by the end of 2006. The centers will be located in each Upazila (sub-district) of Bangladesh. As a result, up to 15 villages containing up to 40,000 people will be within reach of each CIC. In this information center, there will be personal computers connected to Grameenphone's existing GSM mobile network, which has been upgraded with EDGE technology to offer data transfer speeds of up to 16 kilobytes per second.[8]


Grameenphone Centers

A gpc at Gulshan, Dhaka.
A franchised gpc at Tejgaon, Dhaka.A grameenphone center (GPC) serves as a "one stop solution" for customers, with all telecommunications products and services, under a single roof. A grameenphone center also sells phones from vendors like Nokia, Samsung, Motorola,Sagem and Benq. EDGE/GPRS modems and accessories such chargers and headphones are also sold at GPCs.

As of September, 2007, there are 76[9] GPCs and they are strategically located at all major locations of the country is operated by Grameenphone. As of late most of the newly opened gpc's are franchised. Most of these franchised outlets are in non-metropolitan areas.

The GPCs also provide the flexiload service without charging extra for small denominations unlike many retailers in the country. Thus making the gpc's and ideal place for many for such a service.

Every once a while, the GPCs tie up with handset manufactures and start a nationwide marketing scheme by selling the specific vendors products at a price lower than the market's or in bundle with a grameenphone connection loaded with free minutes.