Africa’s telecommunication giant, MTN, has announced its plan to sell 101 billion naira ($244 million) worth of shares in its Nigerian carrier unit as it continues to dispose of its assets to pay off existing debts.
According to a statement released by the mobile-network operator on Thursday, it will issue 575 million shares in MTN Nigeria Communications Plc, which went public in Lagos in 2019.
The company says this move is part of the larger plan to sell around 14% of the parent company’s stake in its largest and most profitable segments.
“Today we announce our intention to proceed with a public offer for sale of up to 575 million shares in MTN Nigeria, by way of a bookbuild to institutional investors and fixed price to retail investors,”MTN Group said on its website.
How will this happen?
The company added that this offer is slated to begin in November 2021 with a book build for institutional investors.
That will be followed by the announcement of a fixed price for individual investors in November 2021. The transaction is scheduled to close in December 2021.
The sale of the shares is the first stage of the company’s previously announced plan to sell about 14% of its current MTN Nigeria stake.
The sale of the Nigerian unit comes at a time MTN is looking to complete a sale-and-leaseback of its South African telecom-mast portfolio and list shares in its Uganda operation in Kampala.
As announced last month, the company also received some cash from the initial public offering (IPO) of tower firm IHS in New York.
MTN’s third-quarter service revenue increased 19%, owing to data and fintech sales.
However, its membership growth in Nigeria slowed to barely 200,000 in Q3, while the company added 1.6 million subscribers worldwide in Q3.
“As more of MTN’s enrolment centres in Nigeria are certified for SIM registration in line with the current regulations, we expect positive net additions to resume during Q4 2021,”
The company is seeing a significant growth in its South African unit as its share climbed as high as 3.6 percent, the biggest in over a month.
The stock has risen 138 percent this year, making it the top performer on the FTSE/JSE Africa Top40 Index, as investors applaud various cash-raising efforts.
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