Pitchbook Template

01/09/2023
 Table of Contents
Company Overview 4 Transaction Opportunities 16

Company Overview 5 Strategic Review and Opportunity 17

Business Model 6

Operating Forecast 7 Team Overview 18

Shareholder Ownership 8 Investment Banking Team 19

Liquidity Analysis 9 Deal Tombstones 20

Industry Overview 10 Appendices 21

Competitive Environment 11

Corporate Finance Activity 12

Valuation 13

Historical Share Price Performance 14

Valuation Overview 15

www.mtn.com.gh
Executive Summary
Background

MTN Ghana is a telecom giant offering services from voice & data to financial services. MTN has an
estimated 68% market share of the the Ghanaian market underpinned by its strong management &
robust investments in infrastructure.
Why

To evaluate the acquisition prospects of MTN Ghana to potential investors.

Next Step

To engage majority stakeholders to sort out acquisition assumptions and formulate a roadmap.

www.mtn.com.gh
Company Overview
 Company Overview
Company Highlights Valuation & Share Performance
• History: MTN Ghana is a multinational telecom company founded in 1996 by the Scancom PLC Key Valuation (¢ MM)
under the Spacefon tradename.

• Valuation: (How has the stock performed? What is the market pricing in? What are the drivers Enterprise Value 18,436 Revenue (2024E) 12,456
behind their success? What are some of the key investment highlights?)

• Strategy: The growth strategy to drive new areas of growth beyond the traditional voice Market Cap ‘23(E) 18,436 EBITDA 5,564
business. To transform from an advanced telco in 2023 to a diversified platform player in 2025.
They have a strong market position with increased data investments.
P/E* 3.79x EBITDA Margin 56.1%
• Corporate Finance Transactions: (What are some of the companies most
recent/notable/transformative acquisitions? Did they raise any equity/debt capital? Did they IPO EV/EBITDA* 3.31x Debt / EV 17%
recently?) Cash 1,176.10 Total Debt 1,987.06
• Ownership: Investcom Consortium Holdings S.A. is a major shareholder with a 78.90% share • *P/E and EV/EBITDA are based on FY22(a) for comparison
followed by JPMC First Rand Bank Ltd & SSNIT with a 3.14% and 1.62% holding respectively.

Industry Data Average Revenue Mix % Gross ($mm) Share Price Current: ¢ 1.50 High/Low: ¢1.55 / ¢0.80
Data 39.2 3,870
Rrelevant Industry Vertical A Voice 33.1 3,269
Mobile Money 19.6 1,935
EV/EBITDA 3.00x

EV/Revenue 2.50x Key Metrics Unit

Operating Data
Relevant Industry Vertical B Operating Data
Operating Data
EV/EBITDA - Operating Data
Operating Data
EV/Revenue (2023E) 1.48X
Operating Data

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Company Overview Valuation Transaction Team Overviews
Industry Overview
Opportunities
 Business Model
Industry Value Chain
Business Model Element 1:
Voice Services via 2G & 3G network, including prepaid and postpaid airtime, international roaming , E-
voucher distribution services & community payphones.

NaaS
API
Business Model Element 2:
Marketplace Enterprise
Mobile & fixed data products, including SMS, MMS, internet access via various technologies including 3G,
WiMAX, EDGE etc.

ayoba
Mobile Industry Theme 1:
money
Accelerated growth in digital and financial service to reduce the relevance of the retail business.

Overarching Competitive Advantage: The Ghanaian telecom industry is worth $1.9 billion as of 2022 with
a CAGR of 3.1% from 2022-2027. MTN has a dominant market share of the voice service, data market &
Mobile Money. MTN , as of 2023 Q2, has 63% of the Ghanaian subscription market followed by Vodafone
& AT with a distant 18% & 17% respectively. The top trends for the sector are wireline subscriptions( 4G & Industry Theme 2:
5G connections), Internet of Things (IOT) etc.
Increase the support for digital evolution of small & medium-sized businesses.

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Company Overview Valuation Transaction Team Overviews
Industry Overview
Opportunities
 Operating Forecast
Revenue Drivers
Data: Voice: Mobile Money (MoMo):
This segment has seen consistent strong growth figures This segment saw its biggest growth following years of flagging Consistent growth in both MoMo revenue and active subscribers
underpinning the strong focus on the business strategy & growth underpinning increased customer acquisition & improved but had a decreased share of the service revenue post E-levy
investments made to expand the network. customer value management with tailored offers. implementation..

• The company predicts a low 20’s growth rate for the service
sector in 2023.
- This projections is in line with company’s historical
values and accounts of a major share of the market
to its two biggest competitors.
• The company projects an increased service growth rate in the • Accelerate growth in diversified services in payments, Fintech
low 20’s. & insurance.
• Increased mobile connectivity with investments in
infrastructure to gain much market.

Revenue & EBITDA Historical

(in millions of U.S. dollars) 2019 2020 2021 2022

Data 1461 1772 2769 3871
Voice 2317 2504 2625 3269
MoMo 959 1254 1733 1935
Total Service 5148 5992 7700 9800
Data Revenue Growth, % 32.5% 21.3% 56.3% 39.8%
Voice Revenue Growth, % 19.4% 8.1% 4.8% 24.5%
Momo Revenue Growth, % 28.0% 32.2% 38.2% 11.7%
Service Revenue Growth, % 22.8% 16.4% 28.5% 28.3%
Total Adjusted EBITDA 2630 3178 4249 5564
EBITDA Margin, % 50.8% 52.7% 55.0% 56.1%

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Company Overview Valuation Transaction Team Overviews
Industry Overview
Opportunities
 Shareholder Ownership
Ownership Analysis
• Institutional ownership of the company is > 95% while retail & insider ownership account for 4.94%. MTNGH has a float turnover ratio of 0.008.
• The op shareholders are a group of institutions mainly Investcom Consortium which has long held a majority shares. This scenario implies that the company is mainly controlled by a single entity hence would offer a
quick transaction solution to potential buyers.

Details Shares held Number of Shares Percentage (%) Holding Details Shares held Number of Shares Percentage (%) Holding

INVESTCOM CONSORTIUM HOLDINGS S.A. 9,697,499,166 78.9 BNYMSANV RE BNYMSANVFFT RE ODD, O KIL AFR 71,334,735 0.58

JPMC FIRSTRAND BANK LTD GTI:73863 386,429,915 3.14 PMSE DUB RE CORONATION FD MGERS IRE ON BEHALF OF THE AFR 58,762,279 0.48
FRTR FUND

SOCIAL SECURITY AND NATIONAL INSURANCE TRUST 198,745,480 1.62

TRUST AC/BNYMSANV RE BNYMIL RE ALL AFR FD 52,896,397 0.43

SSB & TRUST AS CUST FOR KIMBERLITE FRONTIER, AFRICA

165,321,193 1.35 STATE STREET LONDON C/O SSB AND TRUST CO. BOSTON RE
MASTER FUND, L.P-RCKM 43,710,250 0.36
RUSSELL INVESTMENT CO. PLC FUND-NAS5

HUNTER BOFOUR LTD 122,904,743 1

PTY MOMENTUM SP REID SECURITIES LTD 40,200,132 0.33

AFCAP GHANA LTD, A.G 122,904,743 1

BNYM RE VANDERBILT UNIVERSITY 38,456,859 0.31

DADEK HOLDINGS LTD 122,904,743 1

SSB & TRUST AS CUST FOR CONRAD N HILTON, FOUNDATION-00FG 38,077,346 0.31

YEOTECH COMPANY LTD 122,904,743 1

ENTERPRISE TIER 2 OCCUPATIONAL PENSION SCHEME 30,032,267 0.24

SCANVISION INVESTMENTS LIMITED COMPANY 122,904,743 1

JPMC RE DUET AFRICA OPPORTUNITIES MASTER FUND, IC
28,000,000 0.23
GTI:AEX26
STD NOMS/BNYMSANVLUX RE EASTSPRING INVESTMENTS SICAV-
110,306,438 0.9
FIS
OTHERS 607,170,600 4.94
NORTHERN TRUST CO. AVFC 6314B 109,007,588 0.89
Total 12,290,474,360 100

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Company Overview Valuation Transaction Team Overviews
Industry Overview
Opportunities
 Liquidity Analysis
(What is the overarching theme? If your client takes away only one sentence from this slide, what should it be?)

Capital Adequacy
• Capital intensity diminishes over time (Why is this happening? Is it signaling a strategic shift? What does this mean for liquidity? What is the split between growth and maintenance capex?)
• Cash position improves over time (Why is this happening? How is this beneficial? What kinds of opportunities can Company A pursue with all this dry powder?)
• (What are some potential pitfalls Company A might run into? How can these be avoided?)
̶ (Where is capex expected to spike? Why? Are debt maturities evenly spaced out, or are they all within a short duration of each other? What does this mean?)

(in millions of U.S. dollars) 2019 2020 2021 2022

Historical Capex 112 1269 1215 1971
Historical Intangibles Capex 107 220 8 68
Debt Repayment 200 615 445 189

Outs.
Debt Facility Maturity Interest rate Notes
($mm)

Borrowings 387 >12 months 38.9%

2019 2020 2021 2022 Lease liability 1,600 3 years -

Historical Capex Historical Intangibles Capex Debt Repayment

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Company Overview Valuation Transaction Team Overviews
Industry Overview
Opportunities
Industry Overview
 Competitive Environment
Company EV/ LTM Sales Strategy

• AT is moving away from a single –channel management towards an Omni-channel approach.(360◦ initiative). This focuses on the interplay
4.8x between all our different points of contacts to a single platform by utilizing AI & Machine learning to deliver targeted, unique Experiences to
our customers.

• The sale o Vodafone Ghana to the Telecel Group ushered in their plan to issue an Initial Public Offer(IPO) making them the second telecom
- company to list o the GSE. Telecel plans to install 2000 additional towers in the country in the next 2 years. Telecel plans to inject $500 mln in
the first 3 years to expand & refinance Vodafone’s network across the country.

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Company Overview Industry Overview Transaction
Valuation Opportunities Team Overview
 Corporate Finance Activity
MTN Group reports 9.6% rise in 9M19 revenue MTN Ghana & Vodafone Ghana
Ghana to cut MTN Ghana readies 1322 sites for 5G sign national roaming
Communication agreement.
Service Tax to 5% MTN Ghana gets approval
to buy back shares Government to acquire 100% stake in
from IPO subscribers. AirtelTigo

World Bank provides $

200mln to accelerate
digital transformation

Oct 2019 Jul 2020 Jan 2021 Apr 2021 Nov 2021 May 2022 Apr 2022
Aug 2022 Dec 2022 Jan 2023 2014 May 2023 Jun 2023 Aug 2023

Scancom PLC & Vodafone
Ghana sign National
Roaming Agreement
MTN sees an
increase in Half-
Financial Issues forces Surfline year Revenue
to shut down its data
centres.
Vodafone Ghana sale completed
MTN Ghana hit with a
$773 mln back tax

AirtelTigo rebrands as AT
Vodafone agrees to sell Ghana operations to Telecel

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Company Overview Industry Overview Transaction
Valuation Opportunities Team Overview
Valuation
 Historical Share Price Performance
Key Events & Share Price Drivers

• Aug 2023– MTN Ghana sees an increase in Half-Year Revenue

• Jul 2023– MTN to invest $1 Billion in Network Expansion over a 5-year period.
• Apr 2023– Scancom PLC reports Earnings Results for the 2022 FY
• Jan 2023– MTN Ghana hit with a bill of $173 mln for back taxes
• Nov 2022 – MTN records a 35.1% increase in EBT in Q3

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Company Overview Industry Overview Valuation Transaction
Opportunities Team Overview
 Valuation Summary
Stock Price Performance Valuation Football Field
• (How has Company A’s stock performed relative to the market index? By how much? Since when?)
• (Are there any nuances regarding how the market is valuing Company A? What catalysts are
priced in? What are not?)
• (Is there a trend where the market rewards Company A for certain types of activity? Where is the
stock trading at in terms of its 52-week range? Is there causality?)
• (What’s the street consensus? What are common analyst themes? Do they think Company A is
under/overvalued?)

Share Price Current: ¢ 1.50 High/Low: ¢1.55 / ¢0.80

’18e Revenues ‘18e EBITDA ‘18e EBITDA

Broker Estimates Target Prices ($)
($mm) ($mm) Margin (%)

Valuation Metrics Intrinsic Trading Precedents

EV/EBITDA
EV/Revenue
P/E

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Company Overview Industry Overview Valuation Transaction
Opportunities Team Overview
Transaction Opportunities
 Strategic Review and Opportunities
M&A Opportunities
Recommendation

VALUATION OVERVIEW
Industry Vertical A:
Key Transaction Theme 1: MTN Ghana should improve its financial KPI’s( EV/EBITDA, interest
coverage ratio etc.) • EV/EBITDA: 3.0x – 3.2x
1

• To consolidate MTN’s market share and earnings report and given the flagging growth of • EV/Revenue: 2.5x – 4.8x
competitors. • P/E: 0.0x – 0.0x

• The industry has entered its maturity phase resulting in the stagnating
multiples. Investments in coverage expansions is key to revenue
Recommendation

generation.
Key Transaction Theme 1: Implement cost cutting measures esp. to improve profit margins. Company A:
• EV/EBITDA: 3.31x
•
2

EV/Revenue: 3.5x
:
Key Transaction Theme 2 MTN must reserve a large portion of retained earnings I paying off much • P/E: 3.79x
debt
All multiples are NTM
Recommendation

:
3

Key Transaction Theme To undertake in a degree of share buyback in these cash positive flows.

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Company Overview Industry Overview Valuation Transaction
Opportunities Team Overview
Team Overview
 Investment Banking Team
Precedent Transaction Rationale

 “Our team is composed of a comprehensive roster of experienced and knowledgeable seniors and juniors to execute this transaction”
 (For sell-side pitchbooks: What previous transaction experience does the team have? What is their background and education? How many years experience in the industry? What previous relevant
positions have the directors held?)
 (For buy-side pitchbooks: How extensive are the personnel resources of the bank? What divisions of the bank can contribute to what element of the transaction? How can I contact the different individuals
listed?)

M&A Group Equity Capital Markets Debt Capital Markets

First Last Name – Position, Head of, Group First Last Name – Position, Head of, Group First Last Name – Position, Head of, Group
Phone Number Phone Number Phone Number
Email Address Email Address Email Address

Industry Group Team Leaders Leveraged Finance

First Last Name – Position, Head of, Group First Last Name – Position, Head of, Group First Last Name – Position, Head of, Group
Phone Number Phone Number Phone Number
Email Address Email Address Email Address

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Company Overview Industry Overview Valuation Transaction Opportunities Team Overview
 Deal Tombstones
Notable Past Transactions

Company Name Company Name Company Name Company Name

Logo: Logo: Logo: Logo:

.PNG format .PNG format .PNG format .PNG format
$ Deal Amount $ Deal Amount $ Deal Amount $ Deal Amount
Deal Unit Size Deal Unit Size Deal Unit Size Deal Unit Size
Deal Type Deal Type Deal Type Deal Type

Deal Position Deal Position Deal Position Deal Position

DATE DATE DATE DATE

Company Name Company Name Company Name Company Name

Logo: Logo: Logo: Logo:

.PNG format .PNG format .PNG format .PNG format
$ Deal Amount $ Deal Amount $ Deal Amount $ Deal Amount
Deal Unit Size Deal Unit Size Deal Unit Size Deal Unit Size
Deal Type Deal Type Deal Type Deal Type

Deal Position Deal Position Deal Position Deal Position

DATE DATE DATE DATE

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Company Overview Industry Overview Valuation Transaction Opportunities Team Overview
Appendices