By Adeyemi Adepetun (Lagos) and Nkechi Oyedika-Ugoeze (Abuja)
MN Nigeria. Photo: QZ
• NGX tasks Nigerians on subscriptions as offer ends December 14
• Telco to offer 86m more shares if initial is over subscribed
Telecommunications firm, MTN may raise about N97 billion from the series one of the 575 million ordinary shares it is offering to the Nigerian public as of today, December 1.
This was revealed at the virtual media debrief session on the planned sales yesterday. However, MTN made it clear that it was not raising money from the capital market but wanted Nigerians, especially the retail public to have a share of the telecommunications firm’s profitability.
MTN disclosed that should Nigerians over-subscribe the 575 million ordinary shares before the closing date, another 15 per cent, which translates to 86 million more shares would be offered to the public, which invariably means that a total of 661 million ordinary shares are going public.
MTN Nigeria Chief Executive Officer, Karl Toriola, explained that the plan to offer the shares actually started in May 2019, during the reign of his predecessor, Ferdi Moolman.
Toriola, who traced the success of the telecommunications firm in Nigeria to the customers, explained that the offer of 575 million shares does not mean the MTN Group is exiting Nigeria, “but this is done to further cement our commitment to the Nigerian market.”
MTN Chief Financial Officer, Modupe Kadiri, said the offering initially opened between November 23 to 26 via build book to institutional investors, “but the public offering starts from 8 am, December 1 to December 14, 2021. The retail offering would last for two weeks. 10 per cent of the shares go to institutional investors, while the remaining 90 per cent is for the public.”
Kadiri said a minimum of 20 shares is expected to subscribe per individual, stressing that there is an incentive of one free share for every 20 shares subscribed to. He disclosed that the shares would be sold at N169 per share, adding “The share offering is estimated to be about N97 billion, but MTN is not raising money, rather we are selling shares. This must be communicated appropriately to the public.”
“The offer includes a bonus share of one share for every 20 shares bought by a retail investor subject to maximum bonus shares of 250 per investor. However, to qualify for the free share such retail investors must hold the shares allotted to them after the allotment date for at least a period of 12 months.”
The MTN CFO explained that as of May 2019 when the plan was mulled, MTN shares on the Nigeria Stock Exchange sold for N90 per share, “but it is currently selling at N190 per share. This shows that MTN shares are strong and good, and it will be a good buy for Nigerians.”
Commenting, the Chief Executive Officer of Nigeria Exchange Group (NGX), Temi Popoola, said this is an opportunity for Nigerians to have a share of MTN Nigeria.
Popoola, who said he was excited about the offering, said the transaction would change the face of the Nigerian capital market.
He said this would increase investors’ confidence in the market and deepen the number of shareholders on the exchange. He disclosed that the current number of active shareholders in the market remains very low, “but with this MTN deal, we are hopeful that this transaction will change this for good.”
According to him, the public offering is the first offer at the NGX, which is going to be an end-to-end digital, meaning, “you can sit at the comfort of your house and subscribe for the shares.”
On his part, the CEO, Chapel Hill Denham, Bolaji Balogun, assured investors of quick return on investments on the shares.
Balogun, who said he would be subscribing for the shares for all his family members and support staff, called on Nigerians home and abroad to subscribe for the MTN shares, stressing that it will be a good buy in the long run.
He said Chapel Hill Denham is the lead advisor to the offer while issuing parties include Rencap; Vetiva, Stanbic IBTC and RMD.
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