MTN to go ahead on Nigeria stock sale amid market turmoil

MTN will push on with a plan to reduce its majority stake in the wireless carrier’s Nigerian business, though turmoil caused by the coronavirus may require the sale to be done in smaller chunks than anticipated.

The impact of the pandemic on international financial markets doesn’t change the importance of selling part of the 79% shareholding to local investors, chief financial officer Ralph Mupita said in an interview, Bloomberg reported. However, the rest of a three-to-five year plan to dispose of R25bn ($1.3bn) of assets will probably take a back seat for now, he said.

“In Nigeria we still want to do part of our retail offer, even if it’s a smaller part of the total planned sale,” Mupita said by phone. “We are applying our minds to doing this at the moment.”

MTN is disposing of part of its largest division after a series of disputes with Nigerian authorities, most recently over tax payments and the withdrawal of cash from the country. The plan is to sell about a 15% stake to local investors, reducing MTN’s ownership to about 64%. MTN Nigeria Communications was listed in Lagos last year, and is the country’s second-biggest publicly traded company.

Nigeria is MTN’s biggest market, accounting for a third of overall 2019 revenue and almost 40% of earnings before interest, taxes, depreciation and amortisation. The Johannesburg-based company is also the biggest provider of telecom services in the country, with almost 69 million customers, according to the Nigerian Communications Commission.