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MTN is Listing its Shares on the Nigerian Stock Exchange

Telecoms giant, MTN, now says it will be listing its shares on the Nigerian Stock Exchange this Thursday. The company broke the news in a press release it put out to the public on Wednesday.

The listing means that shares in the Nigerian subsidiary of the South African company will be traded on the floor of the NSE, a move which analysts say could renew the public’s interest in the country’s stock market.

It’s been reported that MTN Nigeria has registered 20.35 billion shares with the Securities and Exchange Commission (SEC); about 20% of those shares will be listed for trading on the exchange. The SEC had recently confirmed MTN’s application to list on the bourse.

The company could now become the second largest company on the NSE after Dangote Cement; it’s expected to begin with a market capitalization in the region of ₦1.83 trillion, with its shares valued at ₦90 each.

MTN Nigeria has not always been as driven about going public as it’s recently appeared to be. Thursday’s listing is one of a number of conditions listed for the resolution of a fine imposed on it by Nigerian authorities for failing to disconnect unregistered lines.

The company has had a series of disputes with regulators over the past five years. The government had, in 2018, accused the telecoms operator of improperly repatriating $8.1 billion in profits from the country. The company has since moved to settle the dispute by paying $53 million to the Nigerian authorities.

MTN announced that the shares to be listed are those held by private shareholders who will be “free to trade their shares on the NSE”. The company itself will not be setting up a public sale of its shares.    

The introduction of MTN shares to the NSE may help lift the stock market, which has been bearish for much of this year. The All Share Index, which reflects the behavior of common shares listed on the bourse, has dipped by 8.9% since January. This slide could be remedied in time if market sentiments turn positive with MTN’s arrival at the trading floor.

However, the private sale of its shares may mean that they will be hard to come by for people interested in purchasing them, at least for the time being. Private shareholders may be unwilling to sell at ₦90 per share; it’s more likely that they would be willing to let go if the value rises by a margin they consider significant enough.

The MTN Group’s 2018 full year investor presentation suggests that its Nigerian subsidiary raked in ₦1.03 trillion in revenues last year, up 17.7% from the ₦887 billion it recorded in 2017.

Featured image source: Business Hilights

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Ikenna Nwachukwu

Ikenna Nwachukwu holds a bachelor's degree in Economics from the University of Nigeria, Nsukka. He loves to look at the world through multiple lenses- economic, political, religious and philosophical- and to write about what he observes in a witty, yet reflective style.

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