O’Brien to wait 18 months to sell Digicel shares

Irish billionaire Denis O'Brien has said he will hold off on selling shares in his mobile carrier Digicel Group for at least a year to 18 months, awaiting renewed appetite among investors.

In October, O’Brien planned to raise as much as $2 billion in an initial public offering that would have been the second-biggest in the US last year, before shelving the sale, citing volatility in equity markets.

The time isn’t much better right now, O’Brien said. SecureWorks, the cybersecurity company owned by Dell, sold shares last month in the first US technology IPO of the year.

The company sold eight million class A shares for $14 apiece, after initially marketing nine million shares for $15.50 to $17.50 each.

"We'll revisit in the next year or 18 months," O'Brien, Digicel's chairman, said in an interview with Bloomberg.

“There was an IPO of a Dell business - everybody thought it would be very hot, it didn’t end up that hot even though it was a great company.”

O’Brien said Digicel remains “highly profitable” and plans to keep investing heavily, including through acquiring other businesses.

O'Brien's mobile-phone empire spreads from El Salvador to Vanuatu, built partly on the back of high-risk, high-yield debt.

Corporate debt markets are still showing a “little bit of skittishness,” he said. ‘

“The market is getting a bit more solid, and looking at every credit for its own particular strengths. We have a great spread of assets.’’

The yield on Digicel’s April 2022 bond has dropped to 11.4 per cent from 14.3 per cent three months ago.

O’Brien is worth $3.9 billion, according to the Bloomberg Billionaires Index.

O’Brien said he may draw a dividend from Digicel over the next two years, after halting payments for now.

“In the last 18 months, two years we’ve spent more than than $1 billion on capex,” O’Brien said.

“It seems out of kilter to be paying a dividend to myself. We probably will in the next year, two years, but there’s no rush for that at all.”

- Bloomberg