MTN to divest from Nigeria, moves to offload 40% equities

A major GSM operator, MTN Nigeria is on the verge of reducing its investment stock in the country.

The company’s headquarters in South Africa has confided that it had approached the Nigerian Stock Exchange (NSE), through the Securities and Exchange Commission (SEC) for a window to off load some of its equity holdings in Nigeria by 40 per cent.

Since 2015 when the Nigerian Communications Commission (NCC) slammed a $2 billion fine on the telecoms company for violating some of its rules, MTN management was said to have concluded plans to gradually divest some of its investment in the country.

But the consequence of Nigeria losing the giant company compelled the authorities to wade into the issue and accepted a pro rata payment of the said fine after reducing it by 30 per cent.

However, another controversy was later to hit the agreement when allegations of a serving minister assisting the company to repatriate some dollars back to South Africa disoriented the initial peaceful settlement.

An NSE official confirmed that finishing touches had already been put in place for the telecom firm to offer its shares to the public in the first quarter of 2017.

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“It is difficult concluding that MTN management was forced to go public because of harsh business environment more than it could be argued that it wants to spread the burden of paying the fine imposed on it by NCC, to willing members of the public,” he stated.

With no less than 52 million subscribers to its network, MTN has more than 50 per cent of the active mobile phone lines in Nigeria, with over 40 per cent of the workforce in the sector under its employ.

But the South African group is said to have been jolted by the fine, which saw it sacking most of its senior management staff in the wake of the refusal of the regulatory body to shift ground on the fine.

Sources said arrangements for the sale of the shares had seen both indigenous and foreign financial institutions, including banks jostling for the contract to handle the offer.

Among the banks mentioned were Stanbic IBTC Capital, Standard Bank of South Africa, Standard Advisory London, Citigroup Global Markets, as well as UBA Investment.

Meanwhile, Ripples Nigeria gathered on Monday that MTN had concluded arrangements to increase data tariffs by December 1. An sms served customers read, “Dear customer, please be informed that from December 1, some MTN data tariffs will be increased to reflect the new rates set by the NCC to operators. Thank you.”
By Emma Eke….

 

 

 

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