Wednesday , February 21 2018
Breaking News

MTN to Plan $500m Nigeria Share Sale in 2018

MTN Group Ltd. plans to raise about $500 million from the sale of shares in its Nigerian business during the first half of the year, fulfilling the terms of a deal struck with the West African nation to settle a record fine, according to people familiar with the matter.

Standard Bank Group Ltd. and Citigroup Inc. have been advising Africa’s largest mobile-phone company on the disposal of as much as 30 percent of the Lagos-based unit on the Nigerian Stock Exchange, said the people, who asked not to be identified as the details aren’t public. Most of the shares will be sold to local institutions and individuals, though foreign investors could be brought in to ensure the process is a success, one of the people said.

Spokespeople for MTN and Citigroup in Johannesburg didn’t immediately comment. Standard Bank didn’t immediately respond to calls seeking comment.

MTN agreed to list the Nigerian unit as part of a June 2016 agreement to pay a $1 billion fine for missing a deadline to disconnect unregistered subscribers amid a security crackdown. The penalty, originally set at $5.2 billion, led to the resignation of the Johannesburg-based company’s then chief executive officer and a slump in the share price that’s yet to be clawed back.

If successful, the Lagos share sale will be the biggest on the Nigerian Stock Exchange after Starcomms Plc, which raised $796 million when it listed in 2008, according to data compiled by Bloomberg. MTN, Nigeria’s biggest mobile-phone company with just over 50 million subscribers as of end September, slumped to a loss in 2016 as it absorbed the financial impact of the fine, though said last month it returned to profit the following year.

Nigeria and other sub-Saharan African governments are trying to gain more from international mobile-phone operators taking advantage of rising smartphone use and faster data speeds. MTN has also agreed to sell shares in Ghana as one of the conditions of a deal to gain spectrum rights, while Vodacom Group Ltd., South Africa’s market leader, was ordered to list 25 percent of its Tanzanian business last year, raising $213 million.

 

About Lanre Oyetade

A multiple award winner in Economics and business journalism, Lanre Oyetade has served close to two decades in the media industry, spanning different notable stables, where he is privileged to have risen to the position of a title editor. A masters degree holder in Economics from the University of Lagos and doctoral student at the Babcock University, he is a winner of the prestigious NMMA Capital Market Award for two consecutive years (2004 & 2005), and was also a nominee for the body’s banking and finance and money market awards for two years. In 2013, he also won the Most Outstanding Business-Reporting Title Editor award of the National Institute of Marketing of Nigeria (NIMN). A minister in the LORDS’s vineyard, he has been an inspirational speaker and resource person at many corporate and religious fora since early 2004, and has so far authored three books on the capital market; on personal effectiveness, and on personal finance, in 2008 and 2014, respectively.