Following months of deliberation, pan-African wireless group Celtel has apparently decided on a 25% share float sometime in 2005 that could net it around US$2bn. Celtel, formerly MSI Cellular Investments, currently has cellular properties in 13 African countries. Particularly well established in East Africa, Celtel's subscriber base numbered 4mn in May 2004. Group revenues were reported as being in excess of US$296mn for the half-year to the end of June 2004.

Whatever value the financial markets eventually place on Celtel will clearly be influenced by estimates of the likely growth potential of the overall regional African wireless opportunity.

The good news is that, this year, the International Telecommunications Union (ITU) concluded that Africa was the fastest growing mobile market in the world, with subscriber numbers increasing by over 1,000% from 1998 to 2003, and reaching 51.8mn in the latter year.

It would be easy to discount this total by comparing numbers for the whole continent to some current individual nation mobile phone tallies. In Japan, for (maybe the most extreme) example, the national Telecommunications Carriers Association reports that the summarised total of mobile telephones of all types in use in the country exceeded 83mn at the end of August.

On the other hand, Africa obviously represents a major untapped mobile market prospect: the ITU calculates that average regional African mobile penetration had reached a very modest 6.2% at the end of 2003. In respective 2010 low, medium and high scenarios for future African wireless uptake, the ITU has penetration rates and subscriber numbers at 10.2% and 100mn, 15.3% and 150mn, and 20.4% and 200mn.

Interestingly, the news of the Celtel float is sparking speculation that the group could become a take-over target, attracting the attention of players keen to grow their African holdings. Aside from Celtel, the current big beasts in African wireless are MTN, Orascom and Vodacom.
John Williamson