The market capitalization of the Nigerian Stock Exchange (NSE) soared by N1.83tr on Thursday, May 16, 2019, following the listing of the entire 20.35bn ordinary shares of MTN Nigeria Communications Plc on its premium board, by introduction at N90 per unit.
Fielding questions from the nation’s capital market community after the listing, Ferdinand Moolman, the company’s chief executive officer assured that MTN is in the country for the long haul, with plans to raise the stake held by Nigerian shareholders from the current 19.85% to 35%.
“This is the first phase of the localization of MTN Nigeria, next is the Initial Public IPO stage. We have no plan to leave Nigeria, we believe in this market and think it is strong,” he added.
While expressing pride at the company’s contribution to the growth of the Nigerian Stock Exchange, Moolman urged other telecommunications companies operating in the country to join MTN for deeper and larger stock exchange.
Also speaking, MTN’s Chief Finance Officer, Adekunle Awobodu said Thursday’s listing by introduction is the first phase of the plan for wealth distribution plan for local ownership, which would also enable the market value the stock appropriately, to be followed by the initial public offering (IPO) through which the board hopes to raise local shareholding to 35%.
According to Awobodu, the MTN Nigeria IPO would have been done last year, “but for circumstances that did not allow us,” lamenting that the circumstances are still prevailing today.
Moolman explained further that no date has yet been fixed for the IPO, adding that proceeding with it will depend on a favourable market condition and the readiness of the company for what the funds will be used for.
Listing its shares on the NSE for MTN Nigeria, he stressed, is a journey, adding that the company actually listed its 1,800 employees and 60.3m subscribers, 20.4m active data users, which makes it the nation’s biggest network, giving it 50% market share of the revenue.
The company, he noted, recorded over one billion transactions on its USSD; just as it supports about 50,000 automated teller machines (ATMs) and Point of Sales (PoS) devices across the country.
The company also presented its 2019Q1 financials, with revenue of N282.093bn, up by 13.2% from N249.223bn, while net profit stood at N48.441bn, representing a rise of 50.42%, just as the CFO announced a dividend policy of paying out 80% of its distributable income (net profit).
Besides appreciating the staff and other stakeholders, Moolman thanked the professional advisers to the transaction, including Stanbic IBTC Capital Limited and Chapel Hill Denham Advisory Limited, acting as joint financial advisers, while Stanbic IBTC Stockbrokers Limited was stockbroker.
Commenting on the impact of the deal on the market, Bolaji Balogun, chief executive of Chapel Hill Denham that both advisers successfully got the transaction over the line after months of hard work, said the listing would be very significant.
Besides adding N1.8tr to the NSE market capitalization, making it the second largest company by market cap, “it will also bring more of Nigeria’s best companies on to the exchange and give a wider group of Nigerians the opportunity to participate in its shareholding.”
Of importance, Balogun continued, is the fact that “there are very few companies in Africa today that generate $1 billion of free cash flow and this is one of those special companies and I’m really pleased we have it on the stock exchange.
“This listing would encourage many other large unlisted companies both within that sector and as well as other sectors to start to think about the Nigerian stock market,” he stressed.
Photo Caption: Ferdi Moolman and Dr. Pascal Dozie, chief executive and chairman respectively of MTN Nigeria Communication Plc, on Thursday, May 16, 2019, jointly sounded the closing gong to close trading on the Nigerian Stock Exchange (NSE), in commemoration of the company’s listing by introduction on the Premium Board of The Exchange. To share the historic day with them, from left: Mrs. Erelu Angela Adebayo, national council Member of the NSE (left); Aigboje Aig-Imoukhuede, ex-officio member of the NSE board (2nd left); Oscar Onyema, CEO of the NSE (3rd left); Bolaji Balogun, CEO, Chapel Hill Denham (3rd right); Abubakar Balarabe Mahmoud, SAN, First Vice President of the NSE (2nd right); and Gbenga Oyebode, Director, MTN Nigeria Communication Plc (right), during the listing.
