MTN begins trading on the Nigerian Stock Exchange to boost local ownership

As part of efforts to open up the company to local ownership, mobile network operator, MTN Nigeria (MTNN) is set to be listed on The Nigerian Stock Exchange (NSE) starting today May 16, 2019, after 1:30 pm (Nigerian Time).

After receiving approval from The Securities and Exchange Commission (SEC), MTN will be issuing 20,354,513,050 ordinary shares of 2 Kobo each at N90 per share on the Premium Board of the NSE. The listing will be done by Introduction, that is, the shares of existing shareholders will be listed without an additional public sale of shares. Once listed, MTN Nigeria shareholders will be free to trade their shares on the market.

Being its biggest market with 52.3 million customers in 2017, Nigeria makes up a third of the South African-based MTN Group’s annual profit. The company is believed to be one of the main beneficiaries of Nigeria’s push to liberalize its economy over the past two decades. However, it has faced problems in the country in recent years, among which is increased pressure from the government to boost local ownership.

MTN decided to list its local company in Nigeria in 2016 after agreeing to pay a $1.7 billion fine to settle a SIM card dispute with the government. The listing was scheduled for the first half of 2019.

“As MTN Group we are very pleased that we are taking this first and important step towards increasing the local ownership of the company, and building the equity capital markets in Nigeria,” MTN Group CFO, Ralph Mupita said.

The CEO of MTN Nigeria, Ferdi Moolman, further explained that the company intends to pursue a future Public Offer by selling shares to new investors, thereby giving more Nigerians greater access to the “MTN opportunity” while there are plans to raise local debt as well.

“We appreciate the continued support afforded us by the government, regulators, and people of this great nation. In particular, I would like to thank the staff and management of MTN Nigeria who worked tirelessly to make this day possible,” Moolman said.

The company will be traded under the name “MTNN” and has said it targets a dividend payout ratio of at least 80 percent of its net income in the medium term.

With the listing on the NSE, MTN Nigeria’s market capitalization is projected to skyrocket to about N1.8 trillion, going by its volume of shares of over 20 billion. This means the company will be joining the Trillion Naira Club or Cap (TNC) list, comprising companies listed on The Exchange with a market capitalization of over one trillion naira, Nairametrics reports.

The exclusive group is made up of stocks with the highest valuation in the country and it includes Dangote Cement Plc (N1.9 trillion), Nestle Plc (N1.2 trillion), and Guaranty Trust Bank Plc (N1.03 trillion).

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