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Iraq Gears Up for a $1.3 Billion IPO

Asiacell's attempt to go public in a big way is a big test


One of Iraq’s largest mobile operators, Asiacell, is in the process of raising $1.3 billion for an IPO. It’s the country’s first deal since the U.S. invaded it in 2003.

If the transaction is a success, it will definitely be a huge boost to confidence. Iraq will need to attract outside capital, as well as build its infrastructure, if it wants to grow.

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While U.S. IPOs tend to be focused on institutional investors, Iraq is instead looking to retail buyers. Consider that the share price is only 2 cents. To drum up support for the deal, Asiacell has even placed ads in Iraqi newspapers and other media.

It seems like a good bet that it will generate interest. Founded in 1999, Asiacell is a popular consumer brand in Iraq, with about 10 million subscribers and a market share of about 43%.

Yet skepticism abounds that Iraq can pull off a large deal, especially since its stock market has fairly light trading. After all, Morgan Stanley (NYSE:MS) and HSBC (NYSE:HBC) recently ended their roles as underwriters for the transaction.

Tom Taulli runs the InvestorPlace blog IPO Playbook, a site dedicated to the hottest news and rumors about initial public offerings. He is also the author of “How to Create the Next Facebook” and “High-Profit IPO Strategies: Finding Breakout IPOs for Investors and Traders.”  Follow him on Twitter at @ttaulli. As of this writing, he did not hold a position in any of the aforementioned securities.

Article printed from InvestorPlace Media,

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